COSATU is alarmed by the ongoing job losses
23 January 2017
The Congress of South African Trade Unions {COSATU} is alarmed and deeply concerned by the ongoing jobs losses in a number of economic sectors. We are troubled by the reports that AB InBev has offered voluntary severance packages to some of its middle managers ,despite its commitments on post-merger employment. This follows Anglogold Ashanti’s announcement that it plans to retrench 849 workers in all its operations in South Africa ;and the jobs carnage currently taking place in the poultry industry.
We are calling on government to do something about unemployment and put measures in place to stem the tide of the ongoing retrenchments. COSATU has been warning that while investment in South Africa through mergers and acquisitions has increased, these investments have resulted in the loss of jobs over time in the acquired companies. The AB Inbev merger has resulted in retrenchments by a company that has been solidly growing and that has not undertaken any retrenchment exercise in decades. The same workers, who have carried South African Breweries on their backs are now being put to pasture because the company is chasing profits.
Whilst foreign direct investment is to be welcomed it has negative impact on the economy in particular through repatriation of profits, for instance the payment of dividends. These payments have caused the current account to be in a deficit as payments to the outside world tend to exceed the inflows.
Instead of increasing their investment in SA, companies such as SASOL and Steinhoff have decided to invest more developed economies outside the country. The outward foreign investment has not resulted in high increases in a number of jobs created or improved wages for the workers. This is because in this country we do not discourage companies from using foreign inputs, goods and services like other Western countries do.