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Quarterly Labour Force Survey reveals 61 000 second quarter job losses
Wage subsidies needed to stem the jobs crisis in South Africa
President Zuma's failure to take action is the same anti-poor attitude responsible for cabinet's wasteful expenditure





The findings of the Quarterly Labour Force Survey, which noted that South Africa lost 61 000 jobs in the second quarter alone, highlights the fact that Cabinet must act now to implement a comprehensive wage subsidy policy to stem the jobs crisis in our country. This is a measure that the Democratic Alliance (DA), the Organisation for Economic Cooperation and Development (OECD), the South Africa Growth Initiative at Harvard University's Centre for International Development, and the ANC's own Finance Minister, Pravin Gordhan, have called for. It is a necessary step in the circumstances, and the President's unwillingness to intervene to end the ideological deadlock in his cabinet over this issue is to the detriment of ordinary South Africans.

The costs of employing new labour market entrants remain high, and more and more young job-seekers are being denied opportunities to find work. This trend is borne out by figures released by Statistics SA yesterday, indicating that unemployment increased during the second quarter from 25.2% to 25.3%. On top of the 870 000 jobs lost last year, a further 232 000 jobs were lost in the first six months of this year.

This means that, despite calls from the DA, the OECD, the Harvard Panel and his own Finance Minister, Pravin Gordhan, to develop a comprehensive wage policy proposal, President Zuma's failure to provide leadership on this issue has seen the country lose over 1 million jobs since he took office in 2009, driving the official unemployment figure up to 4.312 million people. This is a clear example of the anti-poor attitude that has come to define the current ANC administration, an attitude that is further illustrated by the ruling party's rampant spending on luxuries for cabinet ministers.

Minister Gordhan indicated his support for wage subsidy proposal in his Budget speech on the 18 February 2010. In his speech, the Minister stated that a discussion document would be released by the end of March this year that would provide ‘further details of the youth wage subsidy proposals'. March has come and gone. The Minister also stated that young South Africans would begin benefiting from the initiative by early 2011. Yet in a reply to a DA parliamentary question earlier this month, the Minister of Finance poured cold water on a fixed timetable, saying that a possible wage subsidy policy is "still under discussion in government". In short, after announcing a wage subsidy policy and a fixed timetable for implementation, we are now are in a situation where there are no further policy details, where there is no fixed timetable, and where the policy is only "under discussion". We have gone backwards.

President Zuma came to power with the assistance of COSATU and the SACP, and it is precisely these groups who now, on entirely spurious grounds, oppose the introduction of a comprehensive wage subsidy policy. The President's need to placate his allies by stalling the wage subsidy plan continues to undermine efforts to address our skills crisis. President Zuma's dithering is undermining the fight against poverty.

As such, the DA calls once again on President Zuma to implement a comprehensive wage subsidy policy.