June 28, 2005

Nation-wide strike against unemployment and poverty

Thousands of South African workers demonstrated against job losses and poverty in a countrywide one-day strike called by trade unions. "We are here to protest the thousands of jobs lost and the slow decline in the core of our economy; we are here to demand a development strategy to ensure that growth in the economy benefits all our people, creating jobs and overcoming poverty on a massive scale," said Zwelinzima Vavi, general secretary of the Congress of South African Trade Unions (COSATU) in a speech in Johannesburg.
According to Vavi, "Two out of five workers cannot find paid jobs - twice as many as ten years ago. Most of the unemployed are young people who have never had a job since leaving school." One in four South Africans in the formal sector and two-thirds of the workers engaged in informal, domestic and agricultural work still earn less than US $150 a month, he added.

Describing the strike action as a success, COSATU spokesman Paul Notyhawa said that almost the entire mining sector had been affected, while 86 percent of the workforce in the textile and clothing manufacturing sector had stayed away. However, South African Chamber of Business spokesman Johan Zietsman said that the strike had affected only 10 percent of workers across the country, and noted that numbers varying between 11 to 80 percent of the workforce in the mining, clothing and textile and steel industries had stayed away.
Quoting local police, the South African Press Agency said that at least 20.000 to 30.000 workers participated in demonstrations held in the cities of Cape Town and Johannesburg.
Finance Minister Trevor Manuel has dismissed the protest as a non-starter. He conceded that a strong rand was worrying for exporters, but said "the idea that you'll weaken the rand by striking against an exchange rate you deem inappropriate - I don't think is a starter". While Manuel said a "different approach" was needed from that of the unions, he said government needed to work with unions to develop "a commonality of perspectives" to address these issues. His comments are likely to lead to increased tension between government and labour over joblessness. Tension is already running high after Statistics South Africa said this week that formal employment had dropped 1,9 percent. Outlining its rationale for the strike, Cosatu said it wanted government to introduce "strong measures to ensure a more competitive exchange rate". These included "a reduction in the real interest rate and a consistent stance on the part of government spokespeople". The labour federation said the overvaluation of the rand in the past two years had caused a flood of cheap imports and undermined the profitability of the mining sector - leading to a situation where two out of five workers could not find jobs.
The department of labour puts the national official unemployment average at 30.5 percent or 4.8 million people, but independent researchers have disputed the department's definition of 'unemployed', with some saying the general level of unemployment has reached 40 percent.
Analysts blame the current strength of the rand against the dollar as one of the main reasons for mass retrenchments, particularly in gold mining: in the last decade the number of people employed has dropped from around 530.000 to just 187.000. COSATU announced that it intends organising pickets and lunch-hour demonstrations in every province until August. (Business Day, Johannesburg)

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