In the wake of the record five-month strike in the platinum sector that was hailed as a success by AMCU (Association of Mineworkers and Construction Union) who led the 70,000 members in protest, South Africa is left reeling with the ramifications.
Collateral damage includes a significant contribution to the negative growth in GDP (-0.6 percent in the first quarter), increased mechanization in the industry and starvation of striking members and their dependents after five months without pay.
While the economy gasps for air in hopes of a recovery, the waters have become increasingly turbulent due to NUMSA (National Union of Metal Workers South Africa), South Africa’s largest union, preparing 220,000 of its members to own tools in the metal and engineering industry following three months of failed wage negotiations.
The deadlock stands where employers have offered a 7 percent to 8 percent increase while NUMSA demands 12 percent. The difference in monetary value is $20.69 (R219), while this is a seemingly insignificant figure NUMSA stands firm that they cannot accept an offer below the double-digit percentile and thus will allow its members to liberate themselves where employers have failed.
The Steel and Engineering Industries Federation of South Africa (SEIFSA) has served a notice of a lockout at all 23 premises of its member companies. This will effectively bring a halt to productivity to all stakeholders in the industry. The South African Chamber of Commerce and Industry (SACCI) has put forward a plea for NUMSA to put the country first and return to the negotiating table.
The strike by metal workers is scheduled to begin on July 1. The very next day NUMSA members at Eskom (the countries primary power provider) are set to begin a picket demanding a 12 percent increase. The implications of which will further delay the development of new power plants that are eagerly awaited to resolve the countries power shortage.
South Africa has taken ownership of the phrase “strike season” and this year Unions have dominated the event regardless of the damage they cause to the economy, capacity for growth and potential for foreign investment into the country.
Matthew Klynsmith earned a business administration diploma at CTI in Cape Town, South Africa. He now works at Strategic Options as an associate partner. To read more reports from Matthew Klynsmith, Go Here Now.
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