STATE OF THE NATION: Government needs to hep the private sector create jobs as well as invest more in the economy

South Africa is slipping away from its target of creating five million jobs in a decade, an economist says.

“The later we are out of the starting blocks, the lower the chances of achieving our aims,” Standard Bank chief economist Goolam Ballim told media in Johannesburg.

Delays in implementing the right policies with urgency made it more difficult to achieve the government’s aim of creating five million jobs by 2020. This aim had been dealt a blow by global economic crises and domestic policies, Ballim said.

“I think it requires leadership of substantial presidential stature beyond just words,” he said the day before President Jacob Zuma is due to deliver his state-of-the-nation-address.

The government needed to recognise that the private sector was the dominant job creator and would participate in the economy when it felt secure, he said.

The government also needed to invest more in the economy, as happened 30 years ago when 50 cents out of every R1 invested in the  economy came from the public sector.

This was down to 30 cents out of every rand when the ANC took power in the early 1990s. Now it stood at around 32 cents.

Ballim said the multiplier effect on public infrastructure spending tended to be much higher than that of private company spending. Investment in rail and transport, for example, would help grow the economy more than a private company investing in a new shampoo,  he said.