LABOUR: Concern Over Minimum Wages
Recent Western Cape Business News
THE Cape Chamber of Commerce is concerned at the possible damage to the economy from provisions to increase minimum wages in the deal that ended the recent coal industry strike.
“This will set a most unfortunate precedent at a time when we should be doing everything possible to bring young people into formal employment,” said Mr Michael Bagraim, President of the Chamber.
“We must make it easier for inexperienced workers to find jobs and not erect more barriers in the form of higher minimum wages. In effect, the higher minimum wage for ‘beginners’ means it is now unlikely that any of the five million new jobs the government desires will be found in the coal industry.”
He said the Chamber understood that some unions feared that lower starting wages would lead to retrenchments of older workers so that they could be replaced by lower-paid young workers, but it was not difficult to ensure that this does not happen. “The lower minimum wages, for instance, can be restricted to, say, those under 21 and there could even be quotas for the percentage of workers on the minimum wage.
“The unemployment problem is probably South Africa’s greatest challenge and if we are to deal with it we need some give and take from both employers and unions. Lower starting wages for a limited period would be an excellent compromise to encourage employers to take a chance on new and inexperienced workers. And the workers will have a chance to gain skills and earn the decent jobs we all want for them.”
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