Kea' Modimoeng

Kea' Modimoeng

South Africa's job creation policies make it difficult to deal with unemployment issues.

Dawie Roodt, economist at the Efficient Group, said yesterday that employment policies in this country are not sustainable because they put more emphasis on job creation than on entrepreneurial development.

Roodt made the comment in response to the Quarterly Labour Force Survey released by Stats SA yesterday, which showed that employment levels in the third quarter have remained stable at 13,7 million.

The stability is due to the loss of about 165000 jobs in the informal sector and a slight gain of about 24 000 in employment in the formal sector.

"Informal businesses are vulnerable to economic slowdown because they don't have huge capital to fall back on," Roodt said.

He doubts if the Accelerated Shared Growth Initiative of South Africa (Asgisa) will meet its target of halving unemployment by 2014.

"The South African economy is unlikely to grow at a rate that would ensure meeting the Asgisa target. Our labour legislation makes it difficult ... to dismiss incompetent workers so businesses are reluctant to employ workers unless there is a serious need.

"The right strategy would be to develop more entrepreneurs and create more wealth by lowering company taxes and improving company registration procedures."