Not much to show from commitments made at Jobs Summit

The Jobs Summit's first reportback shows little progress since over 70 commitments were agreed to nine months ago. Picture: Siyabulela Duda / Moneyweb

After it promised over 250,000 jobs annually, government apparently got too distracted by the elections to follow through.

Last year when President Cyril Ramaphosa gave the closing address at the Jobs Summit, held to come up with a concrete plan to tackle unemployment in the country, he told critics who said the event would be a talk shop to “eat their words”.

At the time stakeholders from government, labour, business and communities had produced an 82-page framework agreement, which outlined 77 commitments across five themed interventions related to the economic sector, small and medium enterprises, education and skills and inclusive growth.

The framework provided detailed guidelines. For example, the final list of issues to be dealt with by the social partners was supposed to be defined in a month and the timeframes for when each issue would have been concluded would happen no later than seven months after the agreement was signed.

Various companies have announced a wave of retrenchments in the past seven months despite there being interventions in place within the framework. For example, within two months of the summit, business and government were meant to establish “rapid response teams” – comprised of experts – to help businesses in crisis in this tough economic environment with the aim of avoiding job losses. The exact modalities of the task teams were supposed to be ironed out a month after the summit.

Nine months since the sweeping commitments were made at the summit that promised to deliver at least 275,000 jobs annually in addition to the jobs that were already being created in the economy, the unemployment rate has increased to its highest levels in a decade, sitting at 29% in the second quarter from 27.6% in the first.

Now stakeholders have vowed to hold more talks.

Election, distraction

“The momentum of the implementation was in one way or another disturbed by the political period of the elections, where the focus at some stage became the elections [in May],” said Minister of Labour and Employment Thulas Nxesi.

Nxesi was speaking at a press briefing held at the National Economic Development and Labour Council (Nedlac) on Thursday, convened to update the public on a report about the implementation of the summit’s framework agreement. Among those accompanying him was business representative Cas Coovadia and Cosatu’s Bheki Ntshalintshali.

While more than 10 million South Africans sit without jobs, in the expanded definition of unemployment, Nxesi told the media that stakeholders had “now agreed that there is going to be a focus on all the projects of the job summit” to fast-track implementation and create clear timeframes and milestones.

Government bottlenecks 

Nxesi said the most serious constraints that had been raised as a hurdle to job creation related to the issues of reliable supply of electricity. South Africans were plagued by Stage 4 load shedding towards the end of 2018 and the beginning of 2019 as Eskom battled to keep the lights on mainly due to poorly maintained infrastructure.

First-quarter GDP figures showed that the economy had contracted by 3.2% – another negative economic indicator last seen 10 years ago when the world was one financial crisis. At the root of this decline was Eskom.

“It’s a very serious matter, the issue of energy. Hence the president has said there needs to be some tough engagement into the issues of Eskom and some of the SOEs because the whole economy depends on electricity,” said Nxesi.

But that didn’t stop there. Nxesi said close to 60% of commitments were government initiatives by the different departments, and the state’s bureaucratic processes in government were an impediment that needed to be dealt with.

He said obtaining water licences for businesses had been another major hurdle that was raised in the report, saying it sometimes took two to three years to obtain licences.

Again, visas for tourism were raised as a challenge that had not been resolved.

Stricter controls 

Nxesi said the government had decided the “best way forward” would be to single out individual departments and ministers who were responsible for certain outcomes to take greater responsibility.

“We must not just say it is the government who is responsible; we must say which department is not moving in driving those issues,” said Nxesi.

He said the ministry of employment and labour would be “very tough” on following up on delivery.

While the stakeholders were initially meant to hold quarterly meetings to provide updates on implementation, these had been moved to monthly meetings. The first of these meetings would take place on September 2 where a draft programme related to all the issues raised in the report would be tabled.

“There is going to be robust debate now and robust implementation on what has been agreed on,” said Nxesi.

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