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Manufacturing Indaba 2018

Rebellion from jobless youth poses real threat

The rebellion of the unemployed youth and the gaping divide between government and big business are two of the biggest threats SA is facing‚ the Gordon Institute of Business Science and Business Day economic outlook conference heard on Thursday (24 January).
ANC heavyweights have viciously taken up the cudgels against major companies like Anglo American Platinum after it announced job cuts in the face of strikes and against Lonmin for allegedly overlooking existing wage agreements and processes‚ while banker FNB came under fire this week for broadcasting an advertisement critical of government. Meanwhile‚ deadly protests in poor areas and labour unrest have continued.

"I am worried we are not beginning to find a cure to the deficit of trust and confidence between the ANC and big business‚" said independent political analyst Aubrey Matshiqi.

He believes engagement between government and business needs to take place on a regular basis‚ and not just when a crisis emerges.

Business could do a better job in finding a cohesive front on big issues‚ said Michael Spicer‚ a vice-president of Business Leadership SA.

"Attacking the trust deficit is very important. It needs to be dealt with on an incremental basis. In the meantime‚ there are also serious issues like the unemployment issue to be dealt with‚" he said.

Chief investment officer of Cannon Asset Managers‚ Adrian Saville‚ said critical concerns like the nationalisation debate‚ unemployment and strikes had tainted the SA landscape.

"Business executives are worried because of policy uncertainty. Anxiety almost seems to have become endemic‚" he said. Economic realities include a sluggish economy‚ weak rand and price inflation threats.

Saville said unemployment in SA was closer to 40% if those who had given up looking for work were included (official figures place unemployment closer to 25%). He said that in some areas‚ unemployment for women was closer to 90%.

He said SA was "starved" of small business creation‚ as it had only 600‚000 versus 700‚000 in Chile‚ which had a much smaller population.

The chief executive of business consultancy ‚ said while Africa was becoming "remarkably competitive"‚ the path ahead would be different to the global one.

"A lot of growth going forward will take place in cities. A lesson for SA is about execution‚ not just strategy. Innovation should be made a national priority‚" he said.

"We have to export more of what we have already. We know‚ from the mining industry‚ we can have 50‚000 jobs tomorrow if only [rail utility] Transnet can give us the rail links. We have to expand the production of mining and agriculture‚" said Spicer.


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