IN THE same week in which Trevor Manuel delivered the National Planning Commission’s National Development Plan to President Jacob Zuma, recruitment group Adcorp released statistics showing South Africa’s labour productivity has fallen to its lowest in 46 years. This is decidedly not a good place from which to review the hopes contained in the development plan.
The numbers are somewhat confusing at first glance. Superficially, output per worker has risen consistently. The problem appears to be that, although labour productivity is recognised as being of overarching importance, there is no commonly agreed method for measuring it. That means, of course, that you can get the numbers to do whatever suits your book at the time.
According to Adcorp, in 1967 the average worker produced R63,162 of real output a year. In 2012, however, real output per worker had escalated to R143,412. You can imagine how well that sits with trade unionists. "Look how workers are performing," they can crow, "yet their wages don’t reflect these huge gains."
But output per worker isn’t produced just by workers. There’s land, capital, and entrepreneurial management to be taken into account too. Adcorp economist Loane Sharp argues that a better procedure is to standardise the output per worker measured by the amount of capital used in production. That yields output per worker per unit of capital.
And, on that basis, the numbers look dreadful. In 1967 the annual output per worker was R7,297 a year. It is now R4,924. That’s a fall of 32.5%. This explains, says Sharp, why labour’s share of national income is at a record low.
These are not numbers trade unionists will want to contemplate. But the unalloyed fact is that labour’s contribution to the common weal has fallen drastically, and it is probably fair to ascribe much of this to the intervention of trade unions. If you just look at the number of stoppages and strikes experienced by this country over the last few years, it explains why we are entitled to call ourselves the strike capital of the world.
Seen against that background, what is the National Development Plan telling us? It cannot be anything other than that we cannot continue down this path. Manuel has already said, though not in such impolite terms, that unless the pace of change and development is accelerated we are heading for the tubes.
Is anyone in the African National Congress (ANC) actually listening? I doubt that very much. I think Manuel is considered yesterday’s man and, in any event, he cannot muster the kind of grassroots support to command respect in his party’s ruling circles.
Not long ago that I wrote in this column of the dangers facing us if we do not encourage big innovation. Joshua Kurlantzick, writing in Businessweek (June 28), noted that, "Brazil and India have used the levers of state power to promote innovation in critical targeted sectors of their economies, producing world-class companies in the process."
These are our Brics emerging market partners. But we aren’t following their example. Council for Scientific and Industrial Research CEO Sibusiso Sibisi says the institution’s discretionary budget, which allows it to do critical high-risk research, is in decline.
"We run the risk," he told Engineering News, "as the discretionary budget declines, of becoming a contract researcher, and not doing proactive research required to address current and future challenges."
Finally, it is noteworthy that the NDP arrived on the same day that Nedbank chairman Reuel Khoza repeated concerns he first expressed in his annual chairman’s statement and for which he became a target for the ANC’s deep displeasure. South Africa is on the road, he wrote, to becoming a rogue state, an expression that has been used about us before.
AN ALBATROSS clattered onto my balcony. Forget SA Express for the time being, it squawked, look at 1Time.
How in hell does it continue flying? In fact, 1Time is actually already a nationalised airline given the big amounts it owes state-owned companies involved in the aviation sector, not to mention the South African Revenue Service. 1Time apparently enjoys more lenient payment terms that those of its competitors. The Airports Company doesn’t allow any carrier to extend its account beyond 30 days. 1Time, according to the albatross, is the exception to an otherwise sensible rule.
So the argument is that, since the government is neck-deep in one way or another in financing 1Time, the airline is effectively nationalised. If that’s true, silly taxpayers are funding four bankrupt airlines — SAA, SA Express, Mango and 1Time.
But you have to hand it to CE Blacky Komani.
He apparently doesn’t mind being a public servant and has made certain that 1Time’s punctuality performance is excellent.
GORDON Waddell died on Monday. He was 75. He was the only Scottish rugby flyhalf to play in two British and Irish Lions tours. Surprisingly, his death has passed almost unnoticed in South Africa.
Waddell was married to Mary Oppenheimer for a time and joined Anglo American, rising to become chairman of mining house JCI from 1981 to 1987. Earlier, he was elected to Parliament in 1974 by winning the Johannesburg North constituency for the Progressive Federal Party.
It was as chairman of JCI, however, that he really made his mark when he moved Rustenburg Platinum’s product from producer pricing to market pricing, a move then seen as radical. This turned JCI from a backwater into the mining sector’s glamour house. Waddell also had a keen eye for potential movers and shakers, his most notable selection being that of Brian Gilbertson, who later became instrumental in the creation of BHP Billiton.
It was Waddell who once remarked that the useful shelf life of CEs was between five and seven years, a rule he himself observed when he left JCI after six years.
His was a full life lived fully.
I AM away next week. This column will return on Tuesday, August 28.
Until then, take care.