216 000 steel,automobile and motor workers ready to join strike.

DATE: 23 June 2005

Johannesburg Press release – for immediate release


Close to 216 000 members of the National Union Of Metalworkers Of South Africa (NUMSA) in the steel, automobile and motor industries will join the COSATU protest action on job losses on the 27/05/2005. NUMSA will hand-over a separate memorandum to steel employers offices across the country in protest of lower wage increases in the steel sector.

In the same breath, given the huge retrenchments in the manufacturing. Employment dropped in the mining sector by 27%. In the steel and engineering employment has slipped by over 30% from 460 000 1985 to a marginal 310 000 in 2005. Between 1999 and 2003 alone employment fell precipitously. According to the Fridge study conducted amongst steel and engineering companies, 13 000 workers lost their jobs. This year alone 5 000 workers lost their jobs due to outsourcing and labour brokering. The major factor for employment decline has been the restructuring of the industry due to intensification of international competition.

It has been revealed that aggregate employment declined dismally in 2002 and continued unabated in 2003, with the youth and rural populace taking the brunt of this decline. According to the Labour Research Services (LRS) the decline in employment has been continuing unabated. In February 2001, it registered 37.0% amounting to 6.9 million unemployed people in the country. According to official statistics the current rate of unemployment in the country is at 40% if we use the expanded unemployment figures.

Labour Research Services further pointed out that of the 43 million South Africans, 10.8 million were living in poverty and this figure is steadily on the rise as more workers are set to lose their jobs. LRS and other economists predicts a further decline in employment in the year 2005 because of government economic policy to prioritise macro- targets, exchange rates controls, liberalisation of trade, labour market flexibility and wage moderation’s. The macro-economic policies of government have had a lasting negative effect on mining, clothing and metal industries. There is a serious problem of faster exchange control deregulation while investment levels and employment creation remain pitiful. There is high economic instability because of capital flight which has seriously contributed to risk and low investment in the country.

It is important to embark on protest action in the metal industries because many workers have been slaughtered through retrenchments. The protest will mark a turning point in the perception of the poor and unemployed that COSATU is serious about job losses. It is a fact that employers destroy jobs in the economy and will definitely feel proud to continue scaling down employment with the current proposals from the ANC discussion document to deregulate the labour market.

The sad truth is that little will be gained economically and politically from further relaxing labor protection. In fact , the Freedom charter as it will be celebrated on the 26 June 2005 in the new -look Kliptown is specifically opposed to the two-tier system. It calls for the same rights and privileges to be afforded to all South African workers.

Every economist and politician knows that South Africa’s labor market is already highly flexible and segmented and to deregulate and formalize again according to age and geographical size of business could be disastrous and counterproductive. The two tier system will further lead to job losses. Workers will not be safe about their jobs. Employment will be precarious in nature leading to low standard of local consumption and demand.

For more information contact Dumisa Ntuli @ (011) 689 1700 or cell 0829737282