Tag: minimum wage

Removing the causes of mass youth unemployment in South Africa would have multiple positive consequences for job seekers. If small businesses and households, “the natural employers of young and untrained workers in an open labour market”, were free of the burden of the minimum wage and other unnecessary regulatory burdens that have been imposed on them, they could make an unprecedent contribution to the economy.

Read our exclusive cover story titled Let me work! - official violation of the rights of the unemployed must end by Eustace Davie, Director, Free Market Foundation, plus a host of other topical management articles written by professionals, consultants and academics in the June/July 2023 edition.

“Don't harm your neighbour” is much better advice. This is a passive rule. It does not require you to do anything, just to refrain from doing some things. I believe the gap between these two rules summarises the gap in Western society between left and right, between Democrats and Republicans, between the kindly, caring, sharing, socialists and the individualistic, thinking, independent, self-reliant capitalists. Both sides passionately believe that their rule is the better one.

If jobseekers in South Africa currently had the right to freely enter voluntary contracts with employers at wages and on conditions acceptable to both parties, the country would not have mass unemployment. Figures recently released by Statistics SA confirm the statement by the International Labour Organisation (ILO) that at 29.8 percent South Africa had the highest unemployment rate in the world. At 4.9 percent the USA had the lowest rate.

New National Minimum Wage (NMW) hourly rates, which will have a significant impact on labour-intensive industries, were published by the Minister of Employment on 21 February 2023, in line with section 6(5) of the National Minimum Wage Act. They will take effect from 1 March 2023.

South Africa’s labour-law regime is difficult, if not impossible, for small businesses to comply with. It imposes a relatively higher cost on them than on large firms. This leads to fewer people employed in small businesses, and often leads to small businesses not being formalised and therefore certainly not complying with the law.

Statistics South Africa has announced that South Africa’s unemployment rate rose to a record high 35.3% in the last quarter of year 2021. This was an increase of 0.4 percentage points from the previous quarterly unemployment rate. The expanded definition of unemployment rate is at 46.2%.

Now in its second revised edition, Labour Law in Practice has sold over 10,000 copies and has helped numerous South African managers and business owners navigate their way safely through what sometimes seems to be an impenetrable maze of labour law and practice.

Uber drivers are currently classified as independent contractors in South Africa, but there are plans to launch a class action to compel Uber SA to confer several key rights on its drivers, which, if successful, will affect the rights of platform workers.

Over the course of lockdown, pundits have shared some harrowing statistics regarding the increase in unemployment in South Africa. In general, our unemployment rates are moving in the wrong direction and the affected households have suffered great hardship as a result, but it is important to understand what this means for our tax base and our growing budget deficit.