22 000 jobs being cut

Johannesburg - Trade union Solidarity on Monday said 32 companies were already retrenching about 22 000 employees, and the number of retrenchments is expected to rise drastically.

According to a report on what it dubbed South Africa's labour recession, Solidarity said the total number of job losses could be much higher because it cannot really be determined how many contract workers were losing their jobs.

The largest number of retrenchments is currently being seen in the mining industry, where 11 695 job cuts have already been announced, and in the vehicle manufacturing industry where 6 100 jobs are being slashed.

Solidarity estimated that if every employee supported between seven and eleven dependants, it meant that between 150 000 and 200 000 people would be affected by the retrenchments.

The job losses also mean less buying power, which then has a ripple effect on the economy of communities.

South Africa is already in a labour recession and unemployment could rise to 25% in the first quarter of 2009, the trade union said.

The general definition of an economic recession is two consecutive quarters of negative growth, while a labour recession is regarded by the trade union as two consecutive quarters of negative growth in the labour market.

Unemployment has risen from 23.1% to 23.2% in the third quarter of 2008 and the trade union expects that unemployment will rise to between 23.3% and 24% in the fourth quarter of 2008, moving as high as 25% in the first quarter of 2009.

"The crisis is here and will only grow," said Dirk Hermann, deputy general secretary of Solidarity.

"We are calling on industries to regard retrenchments only as a crisis measure," Hermann said.

Companies hit hardest by the retrenchments are: Ford (800), ArcelorMittal (200 contract workers), DRD Gold (1 700), Lonmin (5 550 plus 1 400 contract workers), Uranium One (1 013) new car dealers (3 500), second-hand car dealers (1 500), Absa (1 210) and Mutual & Federal (600).

- I-Net Bridge