South Africa

South Africa

Numsa, AMCU and the portent of strike-stricken economy

Numsa, AMCU and the portent of strike-stricken economy

While wintry weather is gathering over South Africa, the shoots of further economic pain are very much on the horizon. The National Union of Metalworkers SA (Numsa) has warned that a strike by its 220,000 members in the engineering and metals sectors is almost inevitable. Meanwhile, the Association of Mineworkers and Construction Union (AMCU) strike in platinum continues. It’s no coincidence the two most important unions in the country are sounding strikingly similar. By GREG NICOLSON.

The load of workers that make up Numsa are not on strike. Yet. Speaking to media on Thursday, General Secretary Irvin Jim accused companies in the engineering and metals sector of arrogantly ignoring the pay and living conditions of workers while rewarding company executives with large bonuses. Numsa wants a one-year deal with a 15% pay increase but says negotiations are deadlocked, a dispute has been declared in the bargaining council, and the union is consulting its members on whether to strike. “Drawing from our past experiences, a strike is inevitable,” said Jim on Thursday, giving employers until the end of the month to help find a resolution.

If workers decide on industrial action, the broader economic consequences could be harsh. On the back of AMCU’s platinum strike, economic growth is in decline and the country could face recession. The SA Chamber of Commerce and Industry business confidence index has fallen to its lowest since 2000. The rand has taken a recent dip and inflation is above the Reserve Bank target range, allowing little room to maneuver with monetary policy.

“It is a challenging period on our economy,” admitted Finance Minister Nhanhla Nene, while speaking to Talk 702 on Wednesday. He remained confident the country could weather the storm by focusing on its infrastructure rollout and ending the platinum strike. (It’s not all bad, by the way, as SA’s position on AT Kearney’s foreign investment attractiveness list rose from 15 to 13 this week).

Numsa said it understood how important its workers in the engineering and metals sectors were to other industries, and the effect a strike would have on different sectors of the economy and workers who would go without pay. They perform services in foundries, machinery and equipment, automotive components, basic metals, electrical engineering, electronics and telecommunications, basic metals and construction engineering. If they go on strike, work at Eskom plants such as Medupi and Kusile aimed at increasing the available power supply on the national grid will be disrupted.

But what of the companies, Jim reasoned. “The employer bodies, particularly Steel and Engineering Industries Federation of South Africa (Seifsa), National Employers Association of South Africa (Neasa) and Border Industry Association (BIA) are hell-bent on retaining and perpetuating the colonial Apartheid wage income disparities,” said Numsa’s statement, replete with references to how the government has failed the working class that still struggles for decent wages (general engineering scheduled employees earn R5,300, they said) while executives are overpaid. Sort this problem out and there won’t be so many strikes, the Numsa leaders suggested.

Numsa has been outspoken on the struggles of the working class this year and many of its comments about the ongoing Apartheid and colonial systems of pay reflect what’s coming from AMCU President Joseph Mathunjwa in his union’s strike in the platinum industry. “We salute those workers in Rustenburg who are on strike for four months,” said Jim on Thursday. “For now there is no alignment with AMCU. We’re supporting the platinum strike. But why not? Workers must unite,” he added.

During the press conference, Numsa faced many questions about how it could agree to the ANC-negotiated “ceasefire” in the standoff within Cosatu while at the same time stay true to the resolutions from its special national congress held last December where the union decided it would not support the ANC in the elections, encourage Cosatu to break from the Alliance, and form a United Front to coordinate working class issues.

It appears the union is in a difficult position. In a recent meeting with Cosatu affiliates it agreed it wouldn’t discuss its concerns in the media while it has presented its case for a united federation that will represent workers’, rather than other interests. Numsa’s resolutions are, however, intact, and are being implemented, and work on the United Front is going ahead, said Jim.

Over at AMCU, it appears that despite discussions facilitated by new Mineral Resources Minister Ngoako Ramatlhodi that have prompted new proposals from both the union and the employers, the platinum strike is set to continue. Speaking to Fin24 on Thursday, Mathunjwa said the latest offer of an R800 increase for the lowest paid workers in the first year of a deal was “just the same offer management put forward months ago” and rejected by workers at a mass meeting. Since Ramatlhodi’s intervention, however, there appears to be more movement towards a resolution.

AMCU was in the Johannesburg Labour Court on Thursday trying to secure a protected strike for its members in the industry. The National Union of Mineworkers is the majority union in the sector and reached a deal through the gold sector’s collective bargaining process last year. AMCU has argued that it should be able to strike for R12,500 at the certain mineshafts where it makes up the majority of workers.

The potential of more strikes and unions looking for higher wage increases to cover historical exploitation and a lack of transformation in the last 20 years could bring worse times yet for economic growth. The unions say it’s necessary short-term pain if the country is going to get to a position of stability. It will be interesting to see what ratings agencies Standard & Poor’s and Fitch Ratings say when they report on South Africa next week. DM


Please peer review 3 community comments before your comment can be posted


This article is free to read.

Sign up for free or sign in to continue reading.

Unlike our competitors, we don’t force you to pay to read the news but we do need your email address to make your experience better.

Nearly there! Create a password to finish signing up with us:

Please enter your password or get a sign in link if you’ve forgotten

Open Sesame! Thanks for signing up.

We would like our readers to start paying for Daily Maverick...

…but we are not going to force you to. Over 10 million users come to us each month for the news. We have not put it behind a paywall because the truth should not be a luxury.

Instead we ask our readers who can afford to contribute, even a small amount each month, to do so.

If you appreciate it and want to see us keep going then please consider contributing whatever you can.

Support Daily Maverick→
Payment options