19th February 2009 

The effects of economic stagnation are already being felt harshly right here in South Africa. According to a report by the Motor Industry Bargaining Council 36 500 jobs were lost in the local motor industry between July and last month.  This number is set to increase as more jobs in the industry are in jeopardy.

"This is terrifying when you consider that jobs will most likely also be lost in other sectors such as mining, manufacturing and textiles. The social ramifications of these retrenchments are enormous," said Narend Singh, IFP Spokesperson on Economics. 

He added: "In his State of the Nation Address President Kgalema Motlanthe stated that alternatives to layoffs will be explored including longer holiday, extended training, shorter working times and job sharing. The IFP hopes that some of the alternatives that have been explored will be implemented urgently and that assistance is given to ailing sectors."

During periods of relative prosperity there were still not enough jobs being created to meet the needs of our growing population.

"We acknowledge that there are impediments preventing us from attaining a higher growth rate, of at least 8%, which is needed if we are to create more jobs.  These impediments, such as rigid labour laws and ageing infrastructure, must be removed and an environment that is conducive to growth, development and investment must be created," said Singh.

The IFP strongly believes that it must be made easier for emerging businesses and SMMEs to obtain finance and other support from our development finance institutions. These institutions must also be properly financed and staffed with professionals who are capable and able to provide a high standard of service. The promotion of SMMEs is especially important for the creation of employment during this difficult time.

"The Umsobomvu Youth Fund has been allocated R1 billion. This Fund was created in 2001 to help youth development but it has not been successful in this regard and has serious shortcomings that have left scores and scores of young people marginalized and excluded from its programmes," said Singh.

In conclusion Mr Singh said: "The promotion of SMMEs and the development of our youth are vital in our quest to create employment. The institutions tasked with assisting these groups should be used for their intended purpose and not to enrich a select few who are politically connected. All forms of corruption and inefficiency must be removed from these institutions."

Contact:
Narend Singh,            083 788 5954 or
Liezl van der Merwe,   083 611 7470.