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The following article is a summary of the 2018 Job Summit
Unemployment in South Africa has been a prominent issue within our economy. High unemployment rates caused extreme cases of poverty and inequalities, as well as a huge cost to the growth of the economy. South Africa faces one of its greatest challenges of unemployment to date. President Cyril Ramaphosa recently addressed the issues of unemployment in South Africa by presenting the Job Summit and discussing ways in which the South African government, as well as stakeholders, can improve the unemployment rate.
During the Summit key causes of extreme unemployment were highlighted, including the lack of meaningful investments to human resources by denying opportunities to own assets and the development of skills. The President also identified that the structure of South Africa’s economy has mainly depended on the extraction of minerals and the ownership thereof has remained highly concentrated, with insufficient transformation. During the past few years job creation has not kept pace with the increasing amount of youth that have entered the South African job market. Corruption was identified as one of the greatest barriers to investment, growth and job creation.
The aim of the job summit was to tackle the key economic challenges in South Africa, which were presented as unemployment, poverty and inequality. The National Development Plan (NDP) aims to reduce unemployment to at least 6% by 2030 in order to tackle the challenges of unemployment, poverty and inequality. Challenges that face government in recent years included the collapse in collaboration between stakeholders such as business, labour and communities. Government in efforts of demonstrating a new social structure for transformation of jobs and economic growth has started the process of engagement with social partners.
Government have drafted a framework agreement in order to make provisions for monitoring internal and external structures as well as ensuring the effective implementation of the framework agreement. Although the agreements require more refinement, they will call upon such as labour, business and communities as social partners to finalise the agreement.
The Job Summit highlighted key issues in agreement with social partners. It was identified that the current economic environment should focus on retaining and creating new jobs. A pledge of commitment was taken by all social partners in taking fundamental steps in avoiding retrenchment as well as supporting struggling companies. The training layoff scheme introduced in 2008 would be immediately revived and improved in order to address these challenges.
Government, as well as social partners, have an agreement whereby all possible solutions are explored prior to the consideration of retrenchment, including sacrificing executive salaries as well as dividends. It was also highlighted during the summit that in order to create growth within the economy, as well as job creation, there is a need for an increase in domestic demand for South African produced goods and services.
In efforts to implement immediate measures to restore the economic growth, investors’ confidence and job creation, government will implement the following:
- Implement growth enhancing economic reforms
- Reprioritise public spending to support job creation
- Establish an Infrastructure Fund, to ensure that infrastructure projects are implemented faster, with less wastage and have a high impact on employment
- Address urgent needs in education and health
- Invest in municipal social infrastructure improvement
In closing, the President reiterated the need for collaboration between government, unions, labour and business so that our collective interests are met in working towards a common vision where the benefits of a growing economy are shared with everyone.
Phelokazi Nyangane
HR Assistant, Johannesburg