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COSATU Today  |  COSATU Speeches

Speech Delivered by the COSATU President, Sidumo Dlamini, at the Jobs for Youth Summit II, held from 26-28 October 2011

Speech Delivered by the COSATU President, Sidumo Dlamini, at the Jobs for Youth Summit II, held from 26-28 October 2011

26 October 2011

Programme director, comrade Yershen Pillay
National Secretary of the young Communist League, comrade Buti Manamela
President General of COSAS comrade Bongani Mani
President of SAYC comrade Thulane Tshetula
Chairperson of Jobs for Youth Coalition, comrade Tshepiso Mofokeng
Leadership from various youth formations
Invited guests
Delegates who have come from all over the country

As COSATU we are pleased to have been invited to address such an important gathering of young people, coming from different walks of life and yet united by a single urgent desire to find answers to the burning question of youth unemployment confronting our country today.

We are inspired by the fact that the basis of this meeting is unity for collective effort to provide collective creative ideas to this challenge of unemployment confronting our country.

In the future we would like to see more unity and more youth formations united behind the tasks that have been set from this gathering, the tasks of job creation for our youth.

We want everyone to know that it is not to our interests as working class formations to work as divided formations when our objectives are essentially the same!

We are certain that government and all South Africans will be more than ready to accept your proposals and use them as part of the national collective endeavour to create jobs.

If government does not listen then we can have a different discussion about how we can make them listen!

As you may be aware, we are currently engaged in negotiations with government and employers regarding the labour law amendments which are contained in four bills, namely the Labour Relations Amendment Bill, the Basic Conditions of Employment Amendment Bill, the Employment Equity Amendment Bill and the Employment Services Bill.

Negotiations at NEDLAC have proceeded based on six themes:

  1. Atypical employment relationships, which in addition to labour broking, encompasses such issues as outsourcing, owner drivers, franchising, seasonal work and part-time work.
  2. Dispute resolution, with the emphasis on the labour courts and the CCMA
  3. Compliance and enforcement
  4. Access to employment
  5. Equity
  6. Collective bargaining

Our approach to these negotiations is in the main guided by the fact we do not see negotiations as a separate legalistic process but as another contested terrain of class struggle that is integral to our strategic objective to fundamentally transform the apartheid labour market.

It is for this reason that we have argued that any labour law review process should be guided by the objectives of decent work.

We enter into these negotiations to create a policy environment that can allow for full employment where all those of working age who are willing and able to work must have access to decent and sustainable employment.

Our participation in these negotiations is guided by our objective to redress the legacy of labour market segmentation and discrimination based on gender, race and age, with the aim of improved quality and security of present jobs, and equal access to new jobs.

Through this labour law review process we want to strengthen labour legislation so that it can have authority to facilitate workplace democracy through enhanced worker control over decision-making.

In the main we want an outcome in which we have legislation that helps us take forward our objective of closing the apartheid wage gap.

Our most immediate target in these negotiations is to ensure that we develop labour legislation that can effectively ban labour brokers because we believe that labour brokers cannot co-exist with the country’s overarching objective to create decent jobs.

As we proceed with negotiations we hear voices that continue to drum up lies and calling for labour market flexibility as a panacea to addressing unemployment.

Our experience as workers is different from these commentators, in that we know through our own pain that labour market flexibility increases worker vulnerability by disrupting workers’ ability to organize.

In addition, labour market flexibility atomizes workers and intensifies competition among them, which drives down the real wage relative to productivity.

Even if workers successfully resist these pressures, capital, through state policy, draws in immigrant labour that has been beaten to submission by neo-liberalism in order to weaken the bargaining position of the working class.

Labour market deregulation also makes it impossible to combine employment with significant skills development because of the precarious nature of employment.

In 2009 it was estimated that 30% of employment in the South African economy is now due to labour brokers. Major players in the wholesale and retail sector for example, which is highly feminized, work with 20% permanent and 80% atypical employees.

As COSATU we have said that there is an alternative to labour brokers and that is to establish a dedicated placement or recruitment institution under the auspices of the Department of Labour, which

will assist prospective candidates for vacancies in the private and public sector to find employment, but not have anything to do with the employment after placement.

Our own practical experience about an already flexible labour market in South Africa has made us wiser and even more vigilant. We can see if a policy proposal will increase the vulnerability and therefore exploitation of our people.

A Youth Wage Subsidy is one such proposal which will heighten the levels of exploitation, whilst bosses go home smiling with their wallets full of money derived from our own taxes in the name of wage subsidy.

Our basic rejection of this proposal is that it is not rooted in the realities that generate the phenomenon of youth unemployment in our country.

In our growth path document we noted that 40% of the unemployed are new entrants into the labour market, who are almost likely to be young people.

Statistics further show that 41% of the unemployed are between the ages of 25 and 34[1]. In addition, 62% of the unemployed have less than secondary school education and 33% have completed secondary education but have no tertiary education. In short, 95% of the unemployed do not have tertiary education.

In addition, more recent statistics show that the long-term unemployed, i.e. people who have been unemployed for more than a year, have increased from 60% of the unemployed to 65%.

This means that most of the unemployment in our economy is structural in nature. We then ask the following question: How is youth unemployment generated?

On average, between 2003 and 2009, 400 000 young people who wrote matriculation exams failed to proceed further with their studies on an annual basis. This means that, on average, 2.8 million young people were added to the pool of the unemployed between these years.

We also noted in our growth path document that the education system prematurely funnels young people to the labour market.

Besides the absence of job opportunities reflected by the high level of job losers, these young people are ill-equipped to cope with the demands of the labour market, especially skills.

In the light of these structural causes of youth unemployment, we do not see the youth wage subsidy as a primary instrument to address youth unemployment.

Besides, the proposal is based on very thin if any empirical evidence. For example, no data is provided on the real wage that is being earned by young people who have the same characteristics as the unemployed, e.g. no secondary education, predominantly African without prior work experience.

If an inexperienced, young person who has not completed secondary education enters the labour market, it is likely that they will earn in the bottom 25% of the current pay scale. The evidence from the most recent statistics shows that people who have not completed secondary education earn R1 200 a month.

People between 15 and 34 earn below R1 300. So we can assume that young, inexperienced people without secondary education would earn R1 250 a month. Deducting R20 daily transport costs to work means that R850 is left for survival, which is R28 a day. This does not take into account dependants.

In any event a significant number of the unemployed youth should be re-integrated into the education system rather than be put into the labour force.

This is important, especially if social and economic policy is genuinely geared towards empowering and increasing the capabilities of young people over the long-term. It is important to have a more holistic, historical and structural approach to the youth unemployment problem rather than a narrow approach that seeks to have government pay the capitalist class in order to employ the working class.

The question then is: where are we then going to get these jobs?

What we know is that there are plans to increase the capacity of the FET sector to enrol 1 million people per annum by 2014.

This will mean that the sector’s capacity must be more than doubled, and an additional 20 000 lecturers must be trained in order to boost the human resource capacity of the sector, which must increase its intake by 150 000 per annum, from its current 400 000. The number of lecturers to be employed must increase by 5000 per annum

We also know that in the 2011 Budget Speech there was emphasis on prioritization of school infrastructure. The scale of the required intervention is huge.

We note for example that 36% depend on pit latrines, 41% of schools have no fencing or the fence is in poor condition and 62% of schools have a learner educator ratio that exceeds 30.

We also know there are serious backlogs in Basic Education, including the fact that 93% of schools have no libraries or libraries are not stocked, 42% of schools depend on boreholes, rainwater or have no access to water on or near site, 61% of schools have no arrangement for disposal of sewage, 21% of schools have no toilets on site or have more than 50 learners per toilet, 62% of schools have a learner educator ratio that exceeds 30, 81% of schools have no computers or more than 100 learners share a computer.

If class sizes are to be equated to those in Brazil, if we reduced the learner-educator ratio to 20, from the average of 30, at least 210 000 more educators would have to be trained.

This does not include the need to build more schools, address equipment shortages, furniture shortages, expand and re-capacitate colleges and their associated support staff complement.

The extension of computer laboratories and libraries will create over 80 000 direct permanent jobs for librarians and computer teachers. This does not take into account jobs created for maintenance of computers, and the fact that many schools have to be wired on the internet and must have TVs.

If we are to address the problem of youth unemployment we will need to see State-owned enterprises, government departments and municipalities playing a leading role in offering scholarships and internships to young people from tertiary institutions, especially from the FET sector.

The state in general, must open the doors of learning in tertiary institutions, and provide the critical transition link between tertiary education and private-sector employment. The state must make FET a sector of choice for school-leavers, through resourcing and employing graduates from the sector.

Part of the task will include aligning the curriculum content of the schooling system, FET and HET sectors to the needs of the new growth path. This will require close monitoring by social partners, of the extent to which:

  • The entire education system is integrated and that premature leakages are eliminated
  • Curriculum content addresses both the social and economic demands, in line with the new growth path and the type of society we want to build
  • State institutions and the private sector grow sufficient demand to absorb the number of graduates being supplied by the tertiary education system; this will require planning capacity in the Department of Labour.

It will also include re-skilling existing unemployed graduates and filling all vacant posts. This can be done with a view to strengthen the capacity of the state by filling all vacant posts. Some of the unemployed graduates can be trained so that they become educators in both the expanded schooling system and the FET sector[2]. These graduates can also be trained to offer critical support to the departments in the social development and the criminal justice system clusters.

There must a more comprehensive programme to support youth SMMEs and co-operatives. Through procurement, financing and marketing the state should target youth entrepreneurs for support.

Effective use and resourcing of the National Youth Development Agency is important so that it offers support services to young people, especially those in rural areas and in working class urban communities.

Youth support should be incorporated as one of the areas in the scorecards for firms from which government procures inputs.

We are calling for an improvement on the current model of Expanded Public Works Programme and make it deliver full and decent employment. In our view this programme offers an excellent opportunity to implement a full employment policy. Nevertheless, there are some important problems with this programme:

  • Its average work-days are 100 slightly over 3 months; this is not sufficient to incorporate skills development and training
  • It offers temporary poverty relief, and is not adequate to guarantee income security.
  • There is an element of profit-making in the programme; outsourced companies employ people to deliver basic infrastructure.

These problems reduce the effectiveness of the programme in contributing positively to labour market outcomes. Income insecurity discourages beneficiaries from making long-term plans such as asset accumulation. Outsourcing drains resources, reduces the extent to which the programme can be expanded and does not promote internal state capacity to deliver basic goods directly. In short, we need to find a way to reconceptualise the EPWP as a non-profit based employment strategy.

In our view we need to reconceptualise the EPWP as an “employer-of-last-resort” (ELR), whose elements include (a) Employment for everyone of working age, willing and able to work (b) Productive employment of the labour force, especially in the delivery and maintenance of social and economic infrastructure (c) A minimum real wage, which can be set according to skill (d) Skills development, as a critical element of the ELR.

ELR will promote decent employment by making it impossible for precarious work to be rampant, because through this policy, the state would directly intervene to change the dynamics of the labour market.

The ELR also directly deals with structural unemployment because it guarantees employment across all skills

The ELR is a minimum-wage employment that includes skills development, so that a worker can move up within the ELR wage structure.

Like the EPWP this concept will be anchored on infrastructure development projects, but such projects will be implemented by the state and not private service providers whose main focus is profit.

Local government will be central in driving this programme because it will provide a base to draw artisan skills, infrastructure maintenance and link municipalities directly to FET training programmes that respond to the needs of the immediate community and local economy.

The introduction of the ELR can be phased in, with targets initially being women, youth, the unemployed, and households with no income at all. Particular attention should be paid to incorporating skills development and training, in line with the developmental mandate of the state.

As COSATU we are saying - here we are; we have no interests and needs that are different from yours. Your plight is our plight; your fight is ours too! Let the history of Youth unemployment in South Africa be written before and after this Summit.

Amandla!

Patrick Craven (National Spokesperson)
Congress of South African Trade Unions
1-5 Leyds Cnr Biccard Streets
Braamfontein
2017

P.O.Box 1019
Johannesburg
South Africa

Tel: +27 11 339-4911/24
Fax: +27 11 339-5080 / 6940
Mobile: +27 82 821 7456
E-Mail: patrick@cosatu.org.za


[1] Quarterly Labour Force Survey, Quarter 2, 2009.
[2]To meet the projected increase in the intake of the FET sector to 1 million students per annum by 2014, it is estimated that we need 20 000 more lecturers. This means that the sector must increase its intake by 150 000 per annum, from its current 400 000. The number of lecturers must increase by 5000 per annum.

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