Johannesburg - Poverty reduction for the lowest-paid workers has hit the kerb in the past 10 years and much of this is because employers do not pay a living wage, it has been found.
The latest research findings also back up other studies that have shown the situation would be a lot more dire if the social grants net had not been expanded in the early 2000s. This coincided with a decrease in poverty levels.
The Working Poor in South Africa 1997-2012 study by Rhodes University’s Michael Rogan and John Reynolds takes the research further, and shows that the labour market has not done nearly enough to reduce poverty.
Despite the early progress in the early 2000s, working poverty remains a problem.
In 2012, more than a fifth of all employed South Africans lived in households where there was not enough income to meet the minimum basic needs of all household members.
“Changes in the labour market over the post-apartheid period have not added appreciably to the demonstrable income effects achieved through the expansion of the social grant system,” say the researchers.
“Rather, it seems that progress in poverty reduction may have stalled somewhat among the lowest-paid workers over the past decade.
“While access to employment is a logical and crucial step to avoiding poverty, it is clearly not enough.
“Our analysis would suggest that the contribution of the labour market to human development in post-apartheid South Africa is not reaching its potential.”
The findings come as the country is facing mass retrenchments, with the ANC estimating that up to 100 000 jobs could be lost this year.
The economy is limping and the official unemployment rate remains stubbornly at 25 percent.
There is fierce debate about what the country needs to do to create jobs, with those advocating a flexible labour market system saying the focus should be on the quantity of jobs created instead of their quality.
While the government has claimed to be a supporter of decent work, it has not done enough in this regard.
It is debating with its social partners what modalities should be used to introduce a national minimum wage.
The ANC has given itself five years to complete the introduction of the minimum wage.
What the Rhodes study shows is that jobs alone are not going to pull South Africans out of poverty and that state social grants are relied upon even among the employed.
Also under the circumstances, no matter the quality of the jobs created, there will have to be an acceptance of higher levels of working poverty in the hope that the trade-off will be much lower unemployment.
“In South Africa we have unemployment and working poverty problems, suggesting what we need are not simply jobs, but rather decent jobs,” the research paper reads.
“Working poverty has persisted over a period which saw high and low levels of economic growth, a high and persistent level of unemployment, the onset of and (partial) recovery from a major crisis, the introduction of protective labour market legislation, and the expansion of the social grant system.
“The persistence of working poverty and unemployment amid the interplay of these potential drivers and mediators of low earnings highlights the difficulties of the challenge that we face.”
The research paper says a combination of labour market and social policy interventions are needed to alleviate poverty among the working poor.
“Employers and the state surely have some level of responsibility for ensuring some minimum level of decent wages.
“At the same time, the greater social responsibility for vulnerable workers is something which should also be shared more widely.”
Labour Bureau