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Job creation doesn’t exist and SA businesses have stagnated due to state capture

Picture: Henk Kruger/African News Agency

Picture: Henk Kruger/African News Agency

Published Aug 19, 2021


Unfortunately, we have had to live through the past 15 years of system failure, particularly the failure of employment.

With the concerted effort of an entire group of people corrupting our government, the government has been left almost bankrupt, without resources to try to correct the system that has failed the workforce.

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We have heard from our president how the individuals involved in state capture are in very powerful political positions, and how they had to ensure that more and more people were employed by the state in order to enable them to control all the services to the state and the money spent by the state.

The bloated civil service assisted the corrupt politicians and senior civil servants to divert enormous tranches of money to themselves as opposed to running the country.

This has meant less money for education, transport and the Department of Employment and Labour, which was supposed to enable individuals to gain access to the world of work.

We have spoken about the hollowing out of the Commission for Conciliation, Mediation and Arbitration and the inefficiency of the Unemployment Insurance Fund and the Compensation Fund.

Many of the individuals who were part of state capture not only destroyed the various entities in the Department of Employment and Labour, but were allegedly in senior positions within the department’s various entities.

The corruption filters all the way through the government, leaving private enterprise at an enormous disadvantage. Private enterprise needs to have the services of the state to enable it to survive and thrive.

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For instance, private companies need to have access to a transport system, electricity and working municipalities (with all the services municipalities should provide). We’ve heard how many of the larger companies have stated that without the services of the municipalities, they could not continue with their businesses and, therefore, were looking to move to greener pastures, particularly to foreign jurisdictions.

However, it is the small businesses who can’t provide any of the services that really suffer. If staff can’t get a train in to work and can’t perform their duties without electricity, the workers will find themselves outside the workplace and merely be added to the unemployed. About 50% of our workforce is unemployed.

Economists across the world tell us that job creation (more than 70%) falls to the small business sector.

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It is the small businesses that will employ the young, the old, the uneducated and the untrained. Most people rely on small business as an entry into the workplace.

For the past 15 years, with our systems crumbling because of state capture, we have seen that small businesses have stagnated. Job creation doesn’t exist and only the businesses who are able to provide their own transport and electricity are able to survive.

Daily, I speak to small business owners and aspirant entrepreneurs who tell me the only way they can survive is to skirt the law. The “entrepreneurs in the making” assure me that if they don’t try in some way to avoid some of the regulations, they won’t even be able to survive a week. As a lawyer, I can’t condone the breaking of our labour laws, but I can understand it.

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I am often heartened to hear from some of the small businesses who have overcome their teething problems and have grown into formal businesses.

Many of the formal businesses then come to me to be registered with the Department of Employment and Labour and the various bargaining councils who have jurisdiction over their type of work.

My plea to the minister of Employment and Labour and to the various governmental departments is to have a relook at the harsh regulatory authority to ensure that we can give a leg up to start-up businesses, particularly businesses in the historically disadvantaged areas.

If we don’t assist the businesses, it will be business as usual and the situation will get worse.

* Michael Bagraim is a labour lawyer. He can be contacted at [email protected]

** The views expressed here are not necessarily those of Independent Media.

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