RECRUITMENT firm Adcorp's August employment index figures suggest the government's current economic growth, industrialisation and job-creation policies are in need of urgent revision. The index shows that employment declined at an annual rate of 2,1% last month - the fourth consecutive monthly decline. Overall, almost 50000 jobs were lost.
These figures reflect a worrying trend and raise serious questions about the relevance and suitability of the government's much-touted New Growth Path (NGP). It is clear that the plan is now so out of kilter with what is happening on the ground that it is irresponsible to simply press on regardless.
The most damning indictment of the NGP is that the sectors that shed the most jobs are precisely those the plan targets to create employment. Even the construction industry is cutting back, which is extremely disappointing given that infrastructure development is the bedrock on which the NGP is supposedly premised.
Overall, the index shows employment in the month fell most sharply in manufacturing (down 19,9%), mining (19,3%) and construction (16%), despite higher export prices for both commodities and beneficiated manufactured products.
Another worrying figure that emerges from the data is that no employment was created by the private sector last month, although the number of government jobs rose 6%. The public sector now accounts for all job creation in the economy so far this year, and while this small mercy is welcome under the circumstances, it is no reason for celebration - such job creation is not sustainable and invariably comes about by crowding out the private sector.
It is to be expected that an economy might lose jobs during and immediately after a recession, but this merely highlights the futility of setting job-creation targets that are not grounded in reality. The question that needs to be asked is whether SA is losing more jobs than necessary given the prevailing domestic and international conditions and, if so, what the cause of this may be.
Statistics SA and Adcorp do not see eye to eye over their respective methodologies, with the former complaining of a lack of transparency and the self-serving nature of Adcorp's focus, and Adcorp suggesting the quarterly L abour F orce S urvey data on which Stats SA bases its conclusions are plagued by small sample sizes and an unrepresentative sampling framework.
However, even when such disagreements are factored into both organisations' research results, it is clear that the gap between the government's job-creation policy and what is happening in the real economy is considerable.
In February, President Jacob Zuma declared 2011 SA's "year of job creation through meaningful economic transformation and inclusive growth". But when it was finally revealed, the NGP's aim of creating 5-million jobs by 2020 and bringing the unemployment rate down to 15% was criticised by both business and labour, which complained that the programme was heavy on rhetoric but light on the concrete measures required to fight rising unemployment and create decent jobs.
At the heart of this widening gap between policy and reality lies a fundamental incompatibility between the ruling party's ideological and political goals and its economic ones. The time has come to acknowledge that transforming SA racially and socially comes at a cost, and that part of the price we are paying may be in the form of jobs lost.
The state may be creating jobs, but it is doing so with taxes paid in the main by less than 5% of the population - the very people, in fact, that it accuses of being responsible for the wage gap, which, economically, doesn't matter.
SA is part of a world economy that is entering another difficult period. The government's primary focus should be removing the barriers impeding private-sector growth, not tilting at windmills.