Unemployment: The BEE Sting

Dealing with unemployment is difficult for any country, let alone a developing nation.

South Africa is currently sitting at a massive 24.5% unemployment rate (this rises to 57% in townships).

Why do I bring this up?

The reason is simple. I want to share some fascinating stories with you of street vendors, BEE, and car hijackers. But I cannot delve into those topics without setting down some groundwork first.

The facts are simple. You have a quarter of the population not working. Add to that the fact that only 12% of the population pays income tax.

Does that figure not shock the pants off you?? I know it did when I first heard it.

Imagine trying to run a nation where 100% of the population demands services such as well-built roads, social programs, streets lamps, police service, governmental offices, health care... but only a little over one out of ten people are contributing to these things financially. It's mind blogging that the SA government are able to make much of anything work on such a brutal shoe-string budget.

When the government itself is struggling to bring in cash, then you know it's tough for the average joe to make a go of it.

As I see it, the SA unemployment issue has two main branches: not enough job creation and not enough skilled laborers.

SA does its best to create jobs, it really does. When you pull into a gas station, three guys begin working on your car: job creation. When you drive along the highway, you see a row of five men cutting the grass on the median by hand with a weed-wacker instead of employing one man on a riding lawn mower: job creation. Go to a restaurant and ten waitresses will work a room of 25 tables: job creation.

For a girl hailing from a first world country where efficiency and productivity are always king, the existence of these jobs seem ridiculously frivolous.

In North America, the businesses are on a constant lookout for innovative ways to pare back and save money through consolidation. Workers must learn to multi task and new technology is constantly explored as a means of replacing human work.

Here, it is the exact opposite. If there is a job that can be broken into smaller parts or distributed over more people, it is done. Job creation is paramount.

But sadly, the reality is that even this cannot keep up with the massive population looking for work. Rural families are multiplying at a rate that the job market simply cannot support.

The other issue is skilled labor. A lot of the people looking for work are undereducated and come from underprivileged backgrounds. They unfortunately don't have the social or mental skills necessary to excel in a fast-paced work environment.

The third biggest issue is, sorry to say, race.

If you are an unemployed, middle-aged white man, it is pretty much guaranteed you will struggle with and fail at finding permanent work.

White women fare a bit better, but it is still incredibly difficult.

In 1997, the South African government launched Black Economic Employment (BEE). It was passed into legislation as an attempt to correct racial inequalities that resulted from years of Apartheid. It was meant to fast-track minorities (i.e not Caucasian) into positions ownership and management, as well as offer them preferential procurement.

Companies in SA are given scorecards in which they must prove they are achieving race-based goals.

Example:

Element	Weighting	Compliance Targets
Ownership	20 points	25%+1
Management Control	10 points	(40% to 50%)
Employment Equity	15 points	(43% to 80%)
Skills Development	15 points	3% of payroll
Preferential Procurement	20 points	70%
Enterprise Development	15 points	3% (NPAT)
Socio- Economic Development	5 points	1% (NPAT)

Source: wikipedia.com 


This program (in my opinion) has led to some devastating results.

It has caused massive wide-spread retrenchment (firing) of white employees. Justin's father fell victim to this in 2008. After 20+ years with his company, the color of his skin resulted in him losing his job. He was retrenched for one reason only: in order for the company to comply with BEE protocols which newly stated that 40-70% of their employees had to be minorities as well as a full 50% of the management. These targets make it very unlikely that he, as a 50+ yr old white male, will ever be hired in a managerial position ever again.

It doesn't take a brain surgeon to think about how this type of reverse racism will negative effect businesses.

Forced to let go of their most qualified workers, companies have had to hire people based on their cultural heritage instead of their experience. How are these businesses supposed to function properly if the majority of its employees are unfit for their job?

Back in August, I was chatting to my tour guide in Cape Town when he disclosed that he used to work as a police officer. I thought it odd that he would give up that job to become a tour operater. The reason? Once BEE came into play, his boss sat him down and told him that he had better like the rank he was at, because there was no way he -- as a white male -- would be chosen for promotion in the future. He ultimately chose to leave, and who can blame him? Imagine being faced with the knowledge that you will never move up in the world for the simply fact that you don't have the 'correct' skin color.

Jonno told me that following graduation from law school, he struggled to find someone to employ him to do his articles training. Even though he graduated from the top law school in the country with a Master's degree, all the top atricles placements went to black applicants. He was tossed out from the start simply because he is white.

BEE has been dubbed a "brain drain" because it forces companies to give white expertise the boot.

It's even difficult for young white South Africans to get employed. Many choose to house sit, babysit, or work for a family-owned business because finding jobs elsewhere is practically impossible.

BEE basically dictates that if a minority is in a pool of applicants, and can do the job, they must be offered the job first, regardless if a Caucasian is more qualified or better suited to the position. Ouch.

This is why you rarely (if ever?) see a white person working at McDonalds, or in a grocery store, or on a construction line. I'd say 99% of entry-level positions here are staffed by black people. Sorry to say, but a white applicant simply doesn't stand a chance when competing against dozens of minorities.

I acknowledge the devastating levels of racism that minorities had to endure during Apartheid. I do believe there should be legislation to help correct those socioeconomic disadvantages. But reverse racism isn't the answer. Discriminating against whites isn't going to help the country in any way.  

The question is, when does the racial discrimination end? Whites first held privilege over blacks and now blacks hold privilege over whites. Is this line of thinking really helping to better anything? Or is it simply perpetuating a devastating pendulum swing of inequality in SA?