Gordhan urges labour law changes

2011-08-15 10:39

Johannesburg - South Africa won't create four million jobs by 2025 on its current growth trajectory unless it changes some labour policies, Finance Minister Pravin Gordhan said on Monday.

“This is not enough to make a significant dent in unemployment,” the minister told an internal auditors' conference in Johannesburg.

According to Statistics SA, South Africa's official unemployment rate currently stands at 25.7%.

Under the expanded definition of unemployment - which refers to people of working age without work and available to start work that week, but who had not looked for work in the four weeks before the Stats SA interview - 7 678 000 South Africans are unemployed.

The new growth path envisages the creation of five million jobs by 2025.

Gordhan suggested that South Africa might have to relax its labour laws in certain cases to grow jobs.

“We may have to change the way we see the labour dispensation in South Africa,” he said.

For example, a balance needed to be found to retain the jobs of the 10 000 people working at clothing factories in Newcastle, KwaZulu-Natal, while still allowing them to earn a reasonable wage and keeping the factories open.

Factories in the area have threatened to close down and relocate to Lesotho or Botswana if they are forced to pay minimum wages.

Gordhan said laws might also have to be relaxed to allow young people to enter the workplace and gain skills and experience at lower wages, but not at the expense of people who already have jobs.

Unless such changes are made, “we will not be able to make the breakthrough we need to create jobs in South Africa”, Gordhan said.

However, this would be done in the awareness of the bitter struggle fought against apartheid for human rights, decent work and decent wages, he said.

“We are not going to lose what we have gained through hard struggles.” 

  • gator - 2011-08-15 11:00

    Why is this taking so long to realize this? As an entrepeneur who have owned several businesses i have lost all interest in new ventures because labour issues have become a real killer. Passive investments make much more sense. Surely this is not in the interest of the country. Every person has unlimited earnings options, but it is up to him/her surely to do what is necessary. If we are going to start paying cleaners R4k+ per month, then those jobs will just disappear. If a certain job has a very low salary, why is that a problem? It is better than nothing, and it gives the person a platform to grow into better paying jobs.

  • DeonL - 2011-08-15 11:00

    At last someone in Parliament with some common sense.

  • Bilbo - 2011-08-15 11:00

    wow, rocket science needed to figure that one out...

  • CAD - 2011-08-15 11:11

    Let's be brutally honest, despite what Cosatu may say, labour, especially unskilled and lowly skilled labour, is a commodity, easily replaced elsewhere. Therefore paying the ridiculous wages for workers that are unproductive and prone to go on strike has made this country uncompetitive and resulted in this high unemployment rate. Cosatu and the labour laws of this country are the main reasons why jobs are destroyed

  • ButBoy - 2011-08-15 11:11

    Funny how the finance minister is the only person in Govt that ever speaks any sense. Could it be because he actually sees where the money comes from, is accountable for it, and doesn't believe there is a never ending supply to be spent at his whim.

  • edu - 2011-08-15 11:12

    FREEDOM from the deadly UNION grip on the country - in our lifetime!!! To get anywhere, he will have to overcome the deadly grip the unions (read "employed")have on the country. If they have their way, the unions will destroy thousands more jobs by banning temps. Ruthless, mercyless, shameful, f..k the poor and unemployed...

  • Wolraad Woltemade - 2011-08-15 11:16

    Ahh, someone is thinking ahead! Good news for a change. Now the rest of the comrades must address the government corruption so that the remaining 3 000 000 may also benefit.

  • Vince York - 2011-08-15 11:18

    Rerum Novarum 1891:- para 38 38. Here, however, it is expedient to bring under special notice certain matters of moment. First of all, there is the duty of safeguarding private property by legal enactment and protection. Most of all it is essential, where the passion of greed is so strong, to keep the populace within the line of duty; for, if all may justly strive to better their condition, neither justice nor the common good allows any individual to seize upon that which belongs to another, or, under the futile and shallow pretext of equality, to lay violent hands on other people's possessions. Most true it is that by far the larger part of the workers prefer to better themselves by honest labor rather than by doing any wrong to others. But there are not a few who are imbued with evil principles and eager for revolutionary change, whose main purpose is to stir up disorder and incite their fellows to acts of violence. The authority of the law should intervene to put restraint upon such firebrands, to save the working classes from being led astray by their maneuvers, and to protect lawful owners from spoliation.

  • Francois - 2011-08-15 11:39

    Minister Gordhan, how long did it take you to figure this one out? It was said 15 years ago!

  • grant9 - 2011-08-15 11:41

    All talk about making adustments to existing jobs, nothing about how new jobs are going to be created. So, Zuma's talk about 500k jobs a year being created for the next 10 years was just that - talk.

  • AndV - 2011-08-15 11:43

    The legacy of so-called "Affirmative/racist action" and discrimination against skilled whites-who would have been able to create more jobs than is now the case is busy to back-fire! How stupid can you be? Unfortunately the ANC's racist policies and discrimination is busy to destroy our once prosperous country. Thanks to our Bishop Tutu the hatred is feuled with his "wise" words. When are these warped-minded beings going to learn?

  • FBK - 2011-08-15 11:44

    At last!!!! Somebody with a brain

  • ai - 2011-08-15 11:47

    It is better to have no work than to have work that doesn't pay decent wages.

      B2187 - 2011-08-15 12:53

      You must be joking!!!!!!! Or are a no-brainer.

      chris. - 2011-08-15 12:54

      So you're saying you'd rather starve waiting for caviar than eat pap?!? Thats the dumbest thing I've ever heard!

      Rocky_III - 2011-08-15 12:54

      So you can spend the day sitting with your one finger in your bum and the other hand held out for a handout from the few that are working. I am suufffeerrrinng...

      Margaret2 - 2011-08-15 13:18

      The problem at the moment is that the worker does not have the legal right to decide how much or how little he is prepared to work for.

      Crispybacon - 2011-08-15 14:03


      tsotsi420 - 2011-08-15 14:05

      @ ai: the beauty is that with lower wages workers have a choice between a lower wage or not to work at all. At a higher wage rate, many workers don't have the choice, they simply can't get work. I don't suppose you know what it's like for the 7 million people who can't even feed themselves ? Any money would be welcomed I'm sure. It's very easy to sit behind your computer with your ideological stance of "it's better not to work", but for some people on the ground what this translates to is "it's better not to eat or have shelter", I can't imagine any of the unemployed would agree with you.

      drystone - 2011-09-28 21:37

      @ai, read Allan's post, try understanding it, and maybe you will change your perception on foreign investment. In the free market system, one works for that amount of pay, if he wants to. If not, there are others that will replace him. Some live in mansions with extremely high expences, while others live in shacks, with low expenses, but at least those that work will be able to survive in their own way. Unfortunately no one can survive without some means of income. I think the majority of our umemployed community would rather work than steal to make a living, yet all sorts of obstacles are being thrown in the way of the investors and job creators that have the knowledge to run businesses and create employment, being tagged as exploiters. Yet, the ones that make promisses to the masses of umemployed, achive nothing, apart from chasing investment out of the country. Some say it's better to have no work than to have work that doesn't pay decent wages, because they themselves don't live in poverty, or work for the gov, where they are protected. Job creators, wether black or white, is what we need in this country. Not BEE, AA, etc etc. Think about it

  • Ed - 2011-08-15 11:48

    ohhhh....wiat till the smart-guys at Cosatu hear this. for them it is better to have 1 person earning minimum wage than 100 people earning a wage...dumb-asses. oh wait, they wont hear or read this because they are all on strike anyway!

  • Bill - 2011-08-15 11:53

    You can't make up your minds can you...! Now in part you are admitting that your present labour laws brought about are not working and you want a dispensation to counteract this unworkable law. During apartheid, we never had this level of unemployment, so why mention the fact that you do not want to lose ground on what you fought for against apartheid! Your pride exceeds your abilities to think and govern with a rational hand! You have to do what is right for the country and do what will put bread on the table for those that do not have employment, not do what whims you personally as party policy!

  • OldSA - 2011-08-15 11:54

    I would rather work for R500 and have something than have to beg for money at the street corner.I think it is ever individuals own choice if he/she is willing to work for a a wage that is less than what is prescribed by legislation.(

  • Weisskopf - 2011-08-15 11:57

    Sjoe, Minister have you consulted Malema and the Labour Unions?

  • g t - 2011-08-15 12:05

    ahhh ... slowly the reality of life sinks in. I wonder how long it will take for COSATU to get the picture?

      B2187 - 2011-08-15 12:51

      No,cosatu will not get the picture, it will be easier to get rid of Gordhan.

  • Faansie - 2011-08-15 12:07

    Basically you do not have to change much, but the following needs attention: Pass a law whereby Unions can be Hold accountable for the damage they cause during strikes.And then make sure they pay. Outlaw Sympathy strikes.

  • ai - 2011-08-15 12:11

    You are contradicting yourself Mr Finance, if those companies are not willing abide by SA laws which protects humanity, then they must go. The bastards just simply want to pocket huge profits while the workers are struggling.

      Ivor - 2011-08-15 12:49

      Never kill the goose that lays the golden egg!! Works is more than just about money, its also about self worth, no matter how small that is.

      Rustique - 2011-08-15 12:50

      AND MORE WORKERS WITHOUT WORK? You must have a government job to say that Mr. Ai1

      Rocky_III - 2011-08-15 12:52

      Why not start your own comapny and see what it is like to have the laziest bloodsucking work force in the world harrasing you every day while you are ecking out a living. You put your skin in the game instead of just bitching with the hard done by attitude. You make me sick.

      gcr - 2011-08-15 13:01

      dear ai - (I hope that doesn't stand for artificial intelligence but rather artificial insemination) - grow some brain cells and understand that primarily it is the responsibility of parents and kids to get a decent education to make your labour offering attractive to an employee. If you are nothing but a self consoling individual with low level education and no skills to talk of then how can you expect to get minimum wages - rather put the horse before the cart than the other way around. When you are unemployed you live off social welfare- if you earn a wage at least you are in the market expanding your experience, knowledge and net worth to an employer - try it sometime. As someone else stated below they would rather earn a wage than stand at a street corner begging

      mswanepoel - 2011-08-15 14:00

      I doubt you have the slightest knowledge of anything resembling finance.

      g t - 2011-08-16 07:46

      I agree that many workers are exploited by business. The EP Herald recently exposed how Sovereign Foods exploit the most desperate in our community. It was a shocking front page report. That article also revealed the evils of labour brokering. Now don't shoot me ... lets be honest and regulate those that are worthy and ban those that exploit. And no ... I'm not ANC/commie/etc ... see my comment below

      g t - 2011-08-16 08:57

      @ ai Sorry ... thought I had a valid argument to support you ... but it was reported and deleted. It was non offensive and I believe, balanced. but Big Brother thought otherwise

  • Cire - 2011-08-15 12:13

    What's this? An ANC cabinaet minister verging on actually making sense? JuJu and Vavi will sonn put a stop to that!

  • Ivor - 2011-08-15 12:35

    We must stop trying to drive the car looking through the rear view mirror and focus on whats ahead. Mr Gordhan is correct that labour laws need to be changed, but the past struggle is irrelevant, as we need jobs for the youth of the future!

  • Oddearring - 2011-08-15 12:36

    Finally, someone with common sense.

      Virginia - 2011-08-15 13:00

      Good fr you Mr Gordhan, but during apartheid, we never had a unemployment problem, we manufactured our own food and clothing, its only since people have been allowed to import that our factories are closing down. Use the same quota system as you do with the sports 80% SA 20% Import.

  • BraBob - 2011-08-15 13:02

    Pravin for president!!!!!!

  • Allan - 2011-08-15 13:13

    Sadly we are no longer competitive in the Global labour force. If a company cannot earn a decent return on its investment in SA then they will go elsewhere. Ai......AyAyAiiiiiii those same bastards employ 10000 people. You are the epitome of arrogance. Try feeding those 10000 people and their 30000 dependants without that salary. Try paying for any government service without the taxes paid by those workers and those companies. Oh yes try organising a union with those 10000 people while they are starving. Maybe people with your mentality should emigrate to a country more deserving of your superior intellect and leave all the bastards trying to earn a living in our beloved South Africa to get on with the business of trying to rebuild our economy..........

  • HJS - 2011-08-15 13:55

    Please lock the honourable minister in a room with cosatu to beat some common sense into them. Best if cosatu tied up in an electric chair and Mr. Gordhan standing near the switch. Might just get the message through to them, what the single biggets cause of job losses has been the past +-20 years.

  • PRO24 - 2011-08-15 14:07

    I agree with Pravi, Without a future tax paying generation, how will we fund the expansion of infrastructure, education and the NHI. Rather half a loaf of bread than a full one I say. Enough with the struggle rubbish and let's build our industrial base to be more competitive internationally. Not to say we need child labour to make government regalia but rather promote locally produced, manufactured and finished products and build from there. Government should lead by example and drive some Hybrid cars (If it is subsidised) or at least locally produced vehicles. Private cars are of course a personal privilege. We need our "Leaders" to lead.

  • Aboo - 2011-08-15 15:09

    regarding the banking sector when you a threat to someones job and you held back .they are still racialist in the banking sector like Absa its all about buddy buddy .the staff of these financial institutions should be investigated by an independant H/R division people are afraid to speak up , you still have that autocratic type of management still living in the past

  • Vusi's Vent - 2011-08-16 07:25

    The Finance minister’s call, whilst sounding very noble, smacks of short term political opportunism and seems not to be grounded on any scientific basis. What the country needs at this time is the creation of sustainable jobs. The argument by Pravin and others to tamper with labour laws is fatally flawed and I will advance only two reasons to support my contention. Changing labour laws to allow employers to fire workers with impunity does not create jobs – even unsustainable ones. Similarly underpaying workers, albeit trainees, does not provide them with levels of disposable income that can procure goods and services to stimulate economic growth. This call by Pravin is an admission that the government does not seem to know or are able to create sustainable jobs. They seem to be as clueless as most Western governments in this regard. It does seem that the only voices of economic rationality in this debate are coming from COSATU. Maybe it is time to stop shooting the messenger and start to listen to the message.

  • Mark - 2011-08-16 08:36

    @ Pro24 - The proposed employment of youth are aimed at empowering and skills upliftment to put an end to poverty to a certain extent. The lower income/less than minimum wages means that these candidates would not earn enough to contribute toward tax, but merely improve infrastructure growth and upliftment. I agree with the labor-laws being to stringent to allow for change. It's a pitty that our comments fall on deaf ears.If our combined input could make a positive change I would raise my opinion 24/7. Why can't they give the responsibility of job creation to another party so that that party can make it their goal and allow the ruling party to tend to other issues?

  • - 2011-08-16 10:49

    Wake up policy makers.The economy is a beast that wants to grow.As it grows it creates jobs so that it can grow some more.All one has to do is to feed the economy, as one does a child,with food that is good for it.Give it bad food and it will decline.Good food and it will grow.What is good food.One can start with infra structure.Maintenance of infra structure Roads,public amenities,like hospitals,schools,water supply sewerage systems,etc.Thris will keep the economy stable and ready to tackle progects to expand the infra structure in terms of need.A good economy also thrives on efficiency.Putting an inefficient person in a key post,employs just one person but the damage to the economy will result in tens or hundreds of job losses.Example , Aventure mine.Just do the basics right.Spend money wizely.Using money for parties or such has the same effect as corruption.It sterilises growth capital.It reduces the ability of the money to expand. In plain terms the economy is the boss.We must play by his rules.

  • embargo - 2011-08-16 12:53

    No comment. Following modern norms, for a price I will consider contributing, fair? More than likely said comment will fall on one mute in any case.

  • Marius Claassen - 2011-08-17 10:00

    we need to realise that we live in a global village textile exporting countries in the east all subsidized our retailers scream when they have to pay import duties so who will pay the price for subsidy?you and you and you

  • RowRobCk - 2011-09-28 21:24

    is it ones right to ask what you want for you labour be it high or lower than the norm?

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