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This year alone, South Africa’s top 39 mining companies have lost the entirety of value gained since 2008. Their market capitalisation fell by a hefty 5% in the six months from June to September. From a height of R910bn in 2011 to R792bn at the end of September, mining’s value to the economy has shrunk by 9% in 18 months.

These are the headline findings of a report on the mining industry released by PricewaterhouseCoopers (PwC) on Wednesday. The report also warns of further job losses as a result of this poor performance, something for which government will ultimately have to answer.

I have today written to the chair of the Minerals portfolio committee, Fred Gona, to request that the PwC researchers responsible for compiling the report be invited to present their key findings to Parliament. I will also table the report in committee and request that a debate be held as to what government should do to prevent further job losses in the sector.

International research has shown that mining has a large multiplier effect on job creation. One study revealed, for instance, that for each direct job created by the Yanocha gold mine in Peru, 14 additional jobs were created indirectly through the associated economic value chain. However, South Africa’s ratio is significantly lower, and experts put the figure here at roughly 6:1 (less than half of that in Peru). There are a few reasons for this, all of which government can address immediately.

Policy uncertainty continues unabated – amendments to mining legislation due to be tabled in late 2011 remain subject to tripartite politics in the run-up to Mangaung. Politics at the expense of jobs is clearly the ruling party’s mantra. Obstacles to local beneficiation remain high – poor access to and unaffordable electricity and other infrastructure. Finally, and most importantly, a new social contract is needed in the South African mining industry, where the labour regulation and BEE regime is informed by the bigger picture of job-creation potential instead of narrow political objectives.

The mining portfolio committee must consider the findings and recommendations of the PwC report critically and leverage this information to prevent further job losses in the mining industry.