A construction industry stakeholder has warned of a looming crisis in the multibillion-rand sector if the proposed R20 an hour national minimum wage (NMW) is implemented.
Gerald Ndlovu, founder and executive director of Black Suppliers, which focuses on the development of emerging building service providers, argued that the R20 an hour NMW was too high for the construction industry.
Ndlovu warned that the contentious NMW might cause further unrest among the country’s workforce, with labour relations already at an all-time low.
South Africa was ranked bottom of 137 countries in the co-operation in labour-employer relations index of the 2017/18 World Economic Forum Global Competitive Report.
Labour unrest and prolonged protests in the economy have been cited as reasons for this poor showing.
Ndlovu protested about the NMW, saying emerging contractors were beneficiaries of sub-contracting work and should be exempt from paying the NMW.
“Their prices are largely fixed and the work is ad hoc, because there is no steady stream of projects,” he said.
The construction industry was among sectors which showed growth last year, contributing an average of 3.9percent to the country’s gross domestic product. More than 1.18million people were employed by the sector, either on a contract basis or permanently.
Ndlovu said if the NMW was “forced across the industry” it would have a detrimental effect on those seeking employment.
He maintained it would decrease the number of job seekers the sector could employ to dent the scourge of unemployment in the country, which was sitting at 26.7percent.
Labour Minister Mildred Oliphant did not implement the National Minimum Wage Bill on May 1, because of an ongoing parliamentary process taking place related to it.
The country has been working on the NMW, which has pitted South Africa’s largest labour federations against each other, since 2014.
Oliphant has said the process, involving high volumes of both written and oral public submissions, was now in the hands of Parliament.
Parliamentary spokesperson Mothapo Molapo could not be immediately reached for comment.
Article by: Business Report, Luyolo Mketane