Successful transformation of SA’s economy must be seen for what it is
BUSINESS LIVE / 15 MARCH 2018 - 06:12 / THABILE WONCI
While SA was reeling from the leadership power tussle between former president Jacob Zuma and his political masters on the one hand, and the current leadership of the governing ANC on the other, Statistics SA added salt to the wound when it released the Labour Force Survey results for the fourth quarter of 2017.
Although the survey showed a decline in the overall unemployment rate by one percentage point to 26.7%, it still illustrates that employment prospects for young people remain dire.
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The overall unemployment rate of those aged 15 to 24 is 51.1%; for those aged 25 to 34 it is 33.4%. Notably, although the percentage of African males from 15 to 24 years who were not in education, employment or training declined by 1.4%, and for black females by 0.5% year on year, black youths of both sexes remain far more likely to be out of work than their white counterparts.
This sad state of affairs is in line with the views shared by President Cyril Ramaphosa during his state of the nation address, in which he said that, “we remain a highly unequal society, in which poverty and prosperity are still defined by race and gender”.
The overall picture as painted by Stats SA is that white males and females are least affected by unemployment, with unemployment rates that are lower than those of black males and females.
Unemployment rates among women in the workforce is tracking higher than the average unemployment rates of the past 10 years, while for men over the same period the unemployment rate is lower than the average unemployment rate.
Ramaphosa needs to be mindful of the “twin challenge” that is facing his government and the country — the quest to grow the economy and make sure that such growth is inclusive.
He should be reminded frequently of the commitment made by then finance minister Malusi Gigaba when he delivered the 2017 medium-term budget policy statement. Gigaba noted that “our starting point therefore is that economic growth and transformation are mutually reinforcing principles”.
I appreciate the call to prioritise economic growth and development, but such growth will be meaningless if it does not address the plight of black-owned small, medium and micro-sized enterprises, which are still marginalised from the mainstream economy.
Black professionals and black women remain underrepresented at executive levels within corporate SA. Successful transformation must be seen for what it is — the real inclusion of the black population in the mainstream economy across all sectors.
SA faces many challenges, ranging from the most obvious ones, such as poverty, unemployment, high crime statistics, large numbers of young black students dropping out of university, communities still operating without basic services and the lack of representation of black professionals and executives in senior and top management or executive levels in corporate SA.
It is appalling that in our quest for the implementation of employment equity, affirmative action and broad-based black economic empowerment policies to create a corporate SA that is a true representation of the prevailing racial demographics in the land, some companies have opted to sit on the periphery with folded arms, leaving the responsibility for a thorough implementation of these transformative policies to the state.
It is high time we started dealing with the real problems our country is facing.
The growth and sustainable strength of a transformed and skills-based society will ultimately limit poverty and unemployment levels across all sectors as companies will have a larger pool from which to select talent.
However, this will not be possible if companies continue to adopt strict economic policies that are unfavourable towards impoverished, ordinary people. This is evident in the steep increase in unemployment numbers across all sectors over the past 10 years, due to big companies implementing cost-saving plans that include reducing labour and other operational costs.
There is a huge need to develop a skills-based society, which can be achieved in a number of ways.
Business must take a shared responsibility for our economic ills and work hand in glove with the government in its drive for economic growth and development, strongly backed by diversity and transformation.
This requires that black professionals, managers and executives are developed to their full potential by the companies they work for and are given space to explore their skills, talent and experience.
The objective of business must extend beyond profit maximisation to include affording black professionals, managers and executives more responsibility and powers. This should include operational control, hiring and firing powers, staff promotion and bonus sign-offs, to mention but a few.
There is an unfortunate notion in corporate SA, especially in the private sector, that black professionals need special training and supervision for them to compete at the same level as their white counterparts. Black professionals often have to work 10 times harder than their white colleagues to be considered at the same level.
This was observed by the late MD and president of the Black Management Forum, Lot Ndlovu, who once said that black managers were considered a training-centre problem in that they were frequently in perpetual training without graduating. This undermines the intelligence of those who are at the receiving end of such patronising treatment.
I realise that there are macroeconomic fundamentals that have contributed to SA’s lacklustre economic performance and that these require a co-ordinated partnership between the government, business and labour so that creative ways can be found to improve the economic fortune of the country.
I am also mindful of the fact that the South African economy has not been performing well over the past few years, to an extent that the 1.3% GDP growth rate realised in 2017 came as a shock to many.
It is evident that the social and economic aspects of transformation are still lagging behind and that the effect of poverty, unemployment and inequality is staggering. There is a huge black skilled labour force that remains marginalised in corporate SA. These negative fundamentals are embedded in our economy and if not properly and promptly tackled the work that Ramaphosa’s new government has committed itself to in tackling the growth and employment question will be in vain.
• Wonci is MD of the Black Management Forum
Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER