Solidarity-ETM Labour Market Index indicates prolonged insecurity

The Solidarity-ETM Labour Market Index (LMI), released today for the first time, indicated continuing job and wage insecurity since the 2009 recession. The index increased from 42,8 to 46,1 in the fourth quarter of 2013, where 50 is the threshold level between rising and falling job and wage security. The Solidarity-ETM LMI was released as part of Solidarity's quarterly South African Labour Market Report.

According to Piet le Roux, senior economics researcher, the LMI is a first in its kind quarterly measure of job and wage security in South Africa. ‘The labour union Solidarity, in collaboration with market strategists ETM Analytics, is pleased to present the LMI as a new source of insight into South African labour market developments. We are excited about the light it sheds on up and downswings in the labour market, the extent of job security and the scope for wage negotiations in South Africa.'

In his presentation this morning on the LMI, Russell Lamberti, Head Strategist at ETM Analytics, explained that the LMI is constructed from quarterly surveys of Solidarity members, general labour affordability measures, and ETM's proprietary business cycle analysis. ‘The index has remained below 50,0 in all but one quarter since Q2 2011, indicating a prolonged period of job and wage insecurity, stagnant-to-rising wages, and retrenchments in some sectors. It has averaged 44,4 since Q1 2009, the middle of the global financial crisis and the start of South Africa's 2009 recession.'

Other topics addressed in this issue of the South African Labour Market Report include:

The labour market implications of the prominent Renate Barnard affirmative action case and the Supreme Court of Appeal's recent ruling on the matter;

Why Pres. Zuma's six million job opportunities target is reasonably realistic, even without a boost from the Employment Tax Incentive Act; and

General economic conditions and Rand weakness.

Click here for the Jan-Mar 2014 edition of Solidarity's South African Labour Market Report, including the Solidarity-ETM LMI.

Click here for technical details on what lies behind the Solidarity-ETM LMI.

Statement issued by Piet le Roux, Senior economics researcher: SRI and Russell Lamberti, Head strategist: ETM Analytics, February 4 2014

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