African economies should focus on job creation _ IOE

| Friday April 16, 2010 00:00

Speaking at a conference about creating employment and sustainable enterprises in Africa, he noted that while Africa's growth levels had, prior to the economic crisis, been high, the job creation intensity of these economies had remained low. Now that the continent was, like the rest of the world, trying to boost economic growth again, economies had to ensure that they did not 'fall into this trap' again, he stated.The IOE, the Pan-African Employers' Confederation, the International Labour Organisation (ILO) and Business Unity South Africa were hosting the African Employers' conference to determine a way forward for Africa to ensure that it could create sustainable new jobs and ensure the sustainability of enterprises.South African Labour Minister Membathisi Mdladlana would present the conclusions of the conference to the Group of 20 Labour Ministers' meeting in the US on April 19. South Africa would be the only African country to be represented at this meeting.

Nkuhlu noted that Africa would have to achieve gross domestic product growth in excess of 7 percent before it could make a significant impact in terms of creating new jobs. ILO Africa regional director Charles Dan commented that unemployment, underemployment and vulnerable employment had been common features in Africa for far too long.

'Today, Africa cannot exit from the crisis without a bold policy drive to generate more productive and decent work,' he said.He added that enterprises were fundamental in achieving the continent's goals of creating decent jobs, but said that there were difficulties in building sustainable enterprises.

Dan said that, as previously noted by the Economic Commission for Africa, the economic crisis provided the continent with an opportunity for structural transformation and sustainable growth, which should be based on a greater diversification of African economies through appropriate investment in infrastructure and human capital.

'Today, we need more localisation in African economies, more social economy (cooperatives, micro-credit institutions, mutual benefit associations, local development and community-based initiatives) as a connecting bridge between formal and informal economies, more local production and more infra-African trade,' he stressed.

 Meanwhile, Mdladlana told the conference delegates that skills, productivity and resource mobilisation formed a triangle of convergences, which when linked with other initiatives, could 'leapfrog Africa to new heights of development'.

The Minister highlighted that governments, business executives and the labour movement across the world were considering how best to leverage the resources at its disposal to improve the quality of life of its people. 'Arguably, human capital development is beginning to emerge as the first priority for governments, business and not-for-profit organisations everywhere in the world,' he stated.Mdladlana noted that South Africa has made some progress to improve the skills' situation in the country.He noted that the South African Revenue Service (Sars) had collected more than R9-billion through the skills levy in the 2009/10 financial year, with 80% of these funds being reinvested by the respective sector education and training authorities (Setas).

The other 20% was used by the National Skills Fund to cater for national skills priorities.The Setas had registered more than 17, 000 artisans in training in the 2008/9 financial year, while more than 109, 000 workers had completed training in scarce and critical skills through learnerships, apprenticeships and other learning programmes, said the Minister.

Mdladlana further highlighted the interventions undertaken during the recession to assist retrenched workers and those faced with possible company closures.

One of these measures had included the R2,4-billion that was jointly provided by the National Skills Fund and the Unemployment Insurance Fund (UIF) for a training layoff scheme, which allowed for companies to participate in alternative training schemes instead of retrenching workers.

By the end of March, 20 companies and about 3,286 were participating in the scheme.The UIF had set aside R5,6-billion to accommodate about 720,000 people that had been retrenched, dismissed and on maternity leave during the 2009/10 financial year.

It had set aside a further R5,1-billion for the 2010/11 financial year, said the Minister.The Department of Labour had also set aside R2-billion, under the UIF, for investment with the Industrial Development Corporation to invest in industries that were willing to save jobs or create new jobs.

Mdlalana noted that 740 retrenched and unemployed learners were also participating in a pilot project, at a cost of about R50-million, to determine how the UIF and NSF can assist them in reentering the job market.

The project involved the manufacturing, engineering and related services Seta, the National Union of Metalworkers of South Africa and employers in the metal engineering sector.

The project's success would be evaluated and could potentially be rolled out to other provinces.Meanwhile, Mdladlana noted that offering wage subsidies was another measure that had been implemented to help boost job creation.

An employer would be provided tax incentives of about R30,000 for each unemployed learner or disabled person that it employed.The Minister noted that this has not been taken up well and was a matter that would have to be investigated.