LETTER: A poverty-creating cocktail

As reported by Thuletho Zwane, SA’s unemployment rate remains atrocious (“Pressure on jobs eases slightly but rate remains extremely high”, August 15). A third of our countrymen can’t find jobs. And that’s a conservative estimate.

Yet this country has boundless opportunities for wealth creation and employment. We have vast natural resources, crumbling but still existent infrastructure, a host of globally respected firms and brands, and a beautiful country that tourists around the world flock to see. 

There should be plenty of jobs to go around. But their creation is blocked by a government that has over-regulated the economy. Employing a worker is just not worth the risk or the cost, so businesses rather shrink or stagnate. Combine this with racial quotas that make employing workers a political exercise rather than an economic one, and you get a destructive, poverty-creating cocktail.

On top of this are the trade unions, which don’t protect workers in SA — they protect their own corrupt interests while being officially and legally in bed with the government. It is in the interest of the unions for jobs to be scarce so they keep them scarce — artificially raising wages and making the cost of keeping employees untenable.

The solution to unemployment is simple. Deregulate. Take existing labour regulations and strip them down to the bare essentials. Let adults work out the terms of their contracts themselves. And remove politics from employment. Get politicised trade unions out of boardrooms and stop racial quotas in employment and business ownership.

Free up our economy and watch the jobs that will be created, and the wealth that will be infused into our country.

Nicholas Woode-Smith 
Cape Town

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