The ‘productivity debacle' revisited: Arguing for cutting workers' wages, Adcorp and Centre for Development and Enterprise (CDE) mislead media and the public.
The Centre for Development and Enterprise (CDE) and the labour broker Adcorp continue to argue for decrease in the real wages on the basis of a claimed ‘fall in labour productivity' during the last decade (see two diagrams below). This is completely false.
SARB data shows that average labour productivity quarter by quarter, year on year, on the average has grown with over 3 per cent during 2000's. Real wage increases have on the average been lower than 3 percent. That is why the wage share of GDP (the yearly national income) has been falling for most of the period. Workers produce more and more and share less and less of the income.
Responding in July to an editorial in Business Day (20/7), the Alternative Information & Development Centre (AIDC) disclosed that two of the tables - ‘Employment in the non-agricultural sectors' and ‘Labour costs in the non-agricultural sectors', which the Reserve Bank (SARB) insists in publishing in every Quarterly Bulletin (QB) - contains data on employment and productivity that are completely wrong for the period 2000-2005. The Reserve Bank confirms that these tables must not be used for productivity calculations.
The SARB productivity assessment is based on the Quarterly Employment Statistics (QES) from Stats SA. The statistics has been corrected and revised three times, starting from 3rd quarter 2002. Why SARB continue to publish the two inaccurate tables is not clear. In a table placed at the end of the QB - ‘Labour in the non-agricultural sectors' - SARB publishes the productivity development data it regards as correct.
However, in the SARB's Monetary Policy Review (2 times a year) or the Quarterly Bulletins' diagrams and discussions on labour productivity, there is never a trace of the twisted data used by Adcorp and CDE.