9 February 2012
There are signs that South Africa is starting to win the war against unemployment, President Jacob Zuma said in his State of the Nation address in Cape Town on Thursday.
Addressing the National Assembly, Zuma painted a picture of an economy that was slowly recovering from the devastating impact of the 2008-09 recession. Close to a million South Africans lost their jobs during that period, but more jobs were created in 2011 as a result of stringent interventions introduced by government.
Zuma quoted figures released this week, which revealed that the rate of unemployment had fallen from 25% to 23.9%, with a total of 365 000 more people employed in 2011 – the country’s best performance since the recession.
“The results are encouraging, although we are not out of the woods yet, given the global economic situation,” he said.
What was also important was that all the new jobs were being created in the formal sector of the economy, in sectors such as mining, transport, community services and trade.
‘Two things we did right in 2011’
He said there were two main things that the government did right in 2011 which contributed to the success.
“Firstly, we mainstreamed job creation in every government entity, including state-owned enterprises. We declared 2011 the year of job creation, and mobilised our social partners, namely business, labour and the community sector, to work with us in implementing the New Growth Path.
“Secondly, we strengthened social dialogue and cooperation between government, business and the community sector.”
Zuma attributed some of the successes in job creation to the accord, signed by government and social partners late last year, which sought to accelerate employment in the private sector.
He underscored the overarching development goal of transforming South Africa into a highly growing economy and dignified society, and that this could be achieved through cooperation and working together.
The work done last year indicates that if the country continued to grow reasonably, the economy could begin to grow at a speed that would create the much-needed jobs.
Call for private sector to come on board
However, the President urged the private sector to work with the government in reaching its ambitious target of five-million jobs by 2020. Such a partnership required a change in the way things had been done.
“Government alone cannot solve the challenges faced by the country, but working together, solutions are possible,” he said.
On the issue of the Jobs Fund, which government announced last year, he reported that over 2 500 applications were received in the first round of the fund. Project allocations of over R1-billion had been committed.
The Industrial Development Corporaton (IDC) had set aside R10-billion for job creation, with Zuma saying that, to date, about R1.5-billion had been approved for 60 companies to promote job creation.
The state had also announced tax breaks worth R20-billion designed to support new industrial projects and manufacturing, with an investment value of R8.4-billion having so fare been approved.
Small business, mining
Also, the procurement regulations empowering the Department of Trade and Industry to designate specific industries where local content is prescribed came into effect in December. The authorities anticipate the move will help speed up job creation in key employment sectors such as the textile and manufacturing industries.
Zuma underlined progress in integrating small business institutions, with a new entity expected to be launched this year.
The government further sees the mining industry, one of the job drivers in the country’s New Growth Path, as playing a critical role in the socio-economic development of the country.
“As part of addressing the triple challenge of poverty, inequality and unemployment, government has developed a beneficiation strategy, which seeks to provide opportunities in the downstream part of the minerals sector,” Zuma said.
“We remain committed to the creation of a favourable and globally competitive mining sector, and to promote the industry to attract investment and achieve both industrial growth and much-needed transformation.”