The Free Market Foundation in Bryanston hosted a discussion about the frightening unemployment rate in South Africa and the possible solutions to remedy the problem.
Eustace Davie, the director of Free Market Foundation said that he is enraged by the current unemployment levels, which have continued to grow year after year. Davie shared that those who are unemployed in the country have been burdened by policies and regulations.
At the beginning of the year, the first-ever national minimum wage was implemented and Davie said that the repercussions of this can already be seen. In the second quarter of the year, the number of those who are unemployed increased by over 450 000.
“The unemployment rate as it is today is totally unnecessary and it should not be like that. The only reason that it has happened that almost 40 per cent of the potential workforce in South Africa is without jobs, is because it’s been made so by legislation and regulation,” claimed Davie.
Davie highlighted that he believes that, as the legal protections and benefits for those who are already employed grow, so do the barriers to entry for an unemployed person. “It is not compassionate to create legislation and enforce regulations that shut more than 10 million job seekers out of the job market.”
The current minimum wage legislation stipulates that a person should earn at least R3 500 a month, depending on the hours worked. However, Davie stated that if every unemployed person earned R1 000 a month, this would amount to over R122 billion a year, which is currently a huge loss to the country.
While minimum wage is implemented to ideally prevent employees from being exploited, Davie argued that it should be up to employees to decide for themselves what terms they find acceptable rather than having them stipulated by law.
Davie proposed a Job Seekers Exemption Certificate which could be given to people who have been unemployed for more than six months. He said that this certificate would exempt the unemployed from labour laws and allow the unemployed to enter into any employment agreement they find acceptable. He said that this would give the unemployed the freedom to make their own conditions.
“If you are unemployed and looking for a job, then you should have the final say as to what wage you will accept, under what conditions you are prepared to work and to agree to your own terms of employment… does anyone have the right to say: No, under R3 500 you are not allowed to work, stay unemployed?” he concluded.
Details: Free Market Foundation fmf@mweb.co.za
Share your thoughts on Eustace Davie’s suggestion for unemployment on the Sandton Chronicle Facebook page
Related Articles:
Free Market Foundation honours Bonang Mohale with Luminary Award
#IMadeMyMark – Could the upcoming elections result in a coalition government?
