Ann Crotty
JUST fewer than 200 000 jobs were created in the 12 months to March, Economic Development Minister Ebrahim Patel told Parliament in his budget speech on Tuesday.
Patel’s perspective on South Africa’s employment figures was considerably more upbeat than the reality indicated by the results of the Quarterly Labour Force Survey (QLFS), which were released by Statistics SA on Monday.
Patel highlighted the comparative strength of the economy, noting that it provided jobs for 13.6 million people, which is an increase of almost 50 percent on the figure before 1994. Workers under 35 years of age account for 1.6 million of the new jobs created since 1994.
In his budget speech, Patel confirmed that the Competition Commission’s inquiry into the private health-care market was likely to be launched in September.
He further stated that 18 construction firms, including the six largest construction companies in the country, had admitted to collusion and were in discussions with the Competition Commission.
Patel told Parliament that the commission had uncovered 300 cases of “irregular and illegal behaviour” by the private sector in the construction industry on projects that had a combined value of just less than R47 billion.
The QLFS figures, released this week, revealed that the number of unemployed people had increased by 100 000 during the first quarter to 4.6 million at the end of March.
Patel said this overall figure masked the fact that 199 000 new jobs had been created in the 12 months to March. Some 44 000 of these had been created in the three months to March.
“The challenge for us is that there is a surge of new entrants into the labour market in the first quarter of every calendar year as people leave school or tertiary level education,” Patel added, noting that the increase in unemployment was not because jobs had been lost but because not enough jobs had been created.
“We have to encourage more growth so that we can absorb these entrants,” he said.
Patel said “solid progress” had been made but acknowledged that the government continued to face many challenges.
He commended the national infrastructure build programme for creating 150 000 jobs.
“The Presidential Infrastructure Co-ordinating Commission is closely monitoring progress made in construction sites across the country, which includes the building of roads, power stations and dams, the deepening of ports, building schools, laying broadband cable and various interventions aimed at changing the spatial patterns of the past.”
Patel said the government had learnt from the 2010 soccer World Cup experience that it was important to have a pipeline of projects so that employment opportunities could be rolled over.
He further noted that infrastructure-related jobs were not permanent but said the national infrastructure build programme “will be creating jobs for at least the next two generations”.
While the minister’s perspective was encouraging and indicated some growth in the economy, the limited extent of job creation reflected the severe pressure under which the government is operating.
In his budget speech last year, Patel had referred to the creation of 305 000 new jobs.
He said another measure the government would soon be implementing in a bid to secure the country’s ability to create jobs related to the introduction of restrictions on the export of scrap metal.
“There have been significant job losses at companies that rely on scrap metal as feedstock for their production. Years ago most of the country’s scrap metal was used domestically now vast quantities of it are exported, mainly to Asia,” Patel said. He added that scrap metal had the benefit of using less energy than iron ore to create products.