Looming job losses due to Eskom, carbon tax may well bring 2018 Q4 job gains to naught

The 87 000 jobs gained in the non-agricultural formal sector (business services, trade, community services and the transport industry) in Q4 2018 as announced earlier today by Statistics SA in its latest Quarterly Employment Statistics (QES) bulletin is pleasing and signal job creation.

The absorption rate remains too low at a mere 43,1% of working age (age 15-64) South Africans being employed.  Employment might tick up slightly as 2019 is an election year during which a considerable number of part-time jobs usually become available.


Looming job losses

The increase in employment may be brought to naught later this year as warnings of dire job losses and looming retrenchments are sounded.

The Minerals Council’s warning of a mining jobs bloodbath due to Eskom’s tariff hikes and the imminent carbon tax ring true.

The council predicts that over the next three years more than 100 000 jobs – nearly a quarter of SA’s mining jobs – will be lost because of the additional costs coming from increased electricity tariffs over the next three years as well as the financial burden of the carbon tax, with the gold and platinum mines bearing the brunt.


Already UASA has noted with sadness a letter from platinum producer Lonmin contemplating restructuring at the mining giant and the possible loss of over 4 000 jobs. As each mineworker on average provides for 10 people, this means that more than 40 000 dependants will have to do without should the breadwinner lose their employment.

We understand that the rising cost of utilities and lower platinum prices puts the sector under immense pressure, but we must call upon Lonmin’s management and leadership to find another way to cut costs.

As cutting jobs should always be a last resort, Lonmin must first consider alternative ways to cut costs. South Africa cannot afford more unemployed workers.

At 27%, South Africa already ranks among the world’s economies with the highest unemployment figures and adding an extra possible 4 000 people to the list would be a tragedy for all involved.

If retrenchments must follow, we do rely on Lonmin to keep the number of affected workers to a minimum.

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