This article was first published by Daily Friend on 16 September 2023
There was a time when South Africa was thought to be the future economic powerhouse of Africa. Those were halcyon days, when Nelson Mandela was president, and all South Africans were equal before the law as guaranteed by the Constitution. Since then, the country has been going rapidly downhill.
South Africa’s unemployed youth are having a hard time. Their misfortunes become steadily worse. Who would have thought that South Africa would one day be described as the country with the highest rate of unemployment in the world?
And the worst of it all is that the terrible situation was unnecessary. There was no good reason to impose the minimum wage on employers, and in so doing prevent young people from working to earn the best wages they can find while learning skills on the job.
If the youth had been allowed to find their own jobs, with friendly businesses and organisations providing advice, the calamitous mass unemployment would not have occurred. I speak from experience.
I started working for a firm of accountants at the age of sixteen. My monthly salary was not sufficient to pay for boarding and other costs. My parents could help me pay those costs, but not luxuries such as the odd movie. The lack of funds helped me keep my nose to the grindstone and prepare for annual examinations. If there had been a minimum wage at the time, I would not have worked for an accounting firm. I would probably not be qualified as an accountant, and not now be writing this article.
The labour economists and their advisers
Refusing to recognise the harm done by the compulsory minimum wage, government officials and their advisers have prevented young people from finding their own jobs, from gaining valuable training at an early age, and of avoiding being categorised as “unemployed”.
Academic promotors of the minimum wage advised the Department of Labour and the country at large that introducing a minimum wage would not cause unemployment. On the contrary, they said, there would in fact be an increase in available jobs (in reality, what they were recommending turned out to be unbelievably bad).
Through the Free Market Foundation, I drew their attention to the introduction of a minimum wage in the United States territory of American Samoa in the Pacific, which caused havoc for its tuna fishing industry. I checked recently and found that the Samoa fishing industry still has problems with the minimum wage, which is foisted on them from afar by the US federal government.
Do the advisers to the South African government have an explanation and a solution for the current substantial number of unemployed South Africans – especially the young? If the Department of Employment and Labour has a solution, they have not applied it!
A practical question arises: For what reason was a minimum wage introduced in South Africa? Was it to improve the employment conditions and availability of jobs to the least capable people in the country? To set a “floor” under the remuneration payable by any employer to any employee?
Whatever the intention, the current situation is extremely bad for the unemployed.
The unemployed and the South African Constitution
There is a case to be made by South Africa’s unemployed people that that their rights under the Bill of rights are being abrogated.
Section 7(1) of the Bill of Rights provides, “The Bill of Rights is a cornerstone of democracy in South Africa. It enshrines the rights of all people of our country and affirms the democratic values of human dignity, equality, and freedom.”
Section 7(2) of the Bill provides: “The state must respect, protect promote and fulfil the rights in the Bill of Rights.”
There would therefore appear to be a case to be made (under the Bill of Rights) by the owner of a small business and a young unemployed person to enter a contract of employment with each other, which may breach the wording of labour legislation, but not that of the Constitution.
What is currently being done to the young people who cannot find jobs below or at the minimum wage is nothing short of criminal. In effect, the young people are being prohibited from working. The mechanism that has been introduced to “legalise” the “minimum wage”, a travesty of justice, is to prohibit employers from employing anyone below a political figure set by bureaucrats in the labour department.
Give JSECs mainly to “below the minimum wage” young applicants!
The Job Seekers Exemption Certificate (JSEC) is a mechanism that could be considered by the Department of Employment and Labour, if it should wish to grant relief to people who have been unemployed for six months or more and cannot find jobs that pay minimum wage.
In preparing the proposal, the Free Market Foundation and I made every effort to consider the rights of potential employers and employees. However, the most important objective is to reduce unemployment as rapidly as possible.
- People who have been unemployed for six months or longer should automatically qualify for a JSEC;
- A simple procedure should be adopted for verifying the details of the applicants and issuing the certificates;
- The exemption granted to the unemployed should cover all labour legislation and regulations, except the common law;
- Employer protection must be complete. No employer who hires a JSEC holder should find themselves in trouble with labour law; and
- Basic, simple, employment contracts should be prepared and signed by the parties in the presence of witnesses.
Implementing the Job Seekers Exemption Certificate or some similar relief for South Africa’s huge body of unemployed people is an essential measure that cannot be delayed any longer.