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Labour Market, Regulation of Labour, Setting Up a Business
Total employment in South Africa rose by nearly 12 % between 1996 and 1999. However the formal sector (excluding farming) recorded a 3.4 %-drop in employment in the same period.
The increase in employment was accounted for by agriculture (45 %), the informal sector (91.5 %) and domestic service (8 %).
| Category | African (% of total) |
Colored (% of total) |
Indian (% of total) |
White (% of total) |
Total |
| Legislators, senior, Officials, managers | 29.1 % | 8.8 % | 6.9 % | 54.8 % | 648,000 |
| Professionals | 36.8 % | 6.3 % | 5.2 % | 51.1 % | 554,000 |
| Technician + associated Professionals | 51.9 % | 9.8 % | 5.0 % | 33.1 % | 1,042,000 |
| Clerks | 42.1 % | 14.3 % | 7.7 % | 35.8 % | 1,071,000 |
| Service workers, Shop + market sales Workers | 68.5 % | 10.9 % | 3.7 % | 16.7 % | 1,225,000 |
| Skilled agric + Fishing workers | 78.5 % | 11.5 % | 0.6 % | 9.4 % | 469,000 |
| Craft + related Trade workers | 68.9 % | 12.8 % | 3.2 % | 15.1 % | 1,355,000 |
| Plant + machine Operators + assemblers | 77.1 % | 13 % | 4.4 % | 5.4 % | 1,092,000 |
| Elementary occupations | 78.5 % | 16.7 % | 1.5 % | 3.2 % | 1,901,000 |
| Domestic workers | 87.2 % | 12.3 % | 0.3 % | 0.3 % | 799,000 |
| Occupations not adequately defined | 59.4 % | 9.4 % | 8 % | 23.2 % | 138.000 |
| Occupation unspecified | 48.7 % | 15.4 % | 5.1 % | 30.8 % | 39,000 |
| Total | 64.3 % | 12.4 % | 3.8 % | 19.3 % | 10,369,000 |
Source: South Africa Survey 2000/2001 p.346
Statistics South Africa defines the labour participation rate as a "proportion of the working age group (15 to 65 years) that is economically active (unemployed or employed)".
| African | Colored | Indian | White | Total | |
| Male | 65 % | 76.2 % | 78.2 % | 77.9 % | 68.1 % |
| Female | 54.8 % | 62.9 % | 51 % | 60.7 % | 56.1 % |
| Total | 59.7 % | 69.4 % | 64.3 % | 69.2 % | 61.8 % |
Using the strict definition of unemployment (which only categorises one as unemployed if they are actively
seeking employment) South Africa had an unemployment rate of 23 % in 1999. Using the expanded definition, the
country had an unemployment rate of 36 %.
(South Africa Survey 2000/2001, p.333)
According to the South African Network of Skills a lot of South Africans continued to emigrate, resulting in a loss of skills.
According to PE Corporate services, a consultancy company, South Africa experienced a shortage of managerial and technical staff during 2000 and 2001. The consultancy estimated that the country faced a shortage of between 35,000 and 500,000 people in the managerial and technical sectors.
The country further faced a shortage of 2,500 people in information technology. The Human Sciences
Research Council (HSRC) said that they expected the Information Technology figure to grow to 41,000 by the year
2003. According to a database kept by an internet recruiting agency(Jobnavigator) there were 35 % more jobs
available for information technology developer or programmers than there were candidate.s
(South Africa Survey 2000/2001, p.364)
South Africa’s shortage of networking professionals was to rise by 33 % in 1998 to 62 % by 2003, according to a report commissioned by CISCO systems, an international networking group (South Africa Survey 2000/2001, p.364).
Here is also a shortage of business executives in South Africa, according to MSL-Index. The index tracks skills shortages and employment opportunities by monitoring advertisement in newspapers. The index showed that the demand for executives rose from 1,808 in the first quarter of 1999 to 2,475 in the first quarter of 2000 – an increase of 37 %.
South Africa is also vulnerable to a shortage of professional accountants, according to Tower Personnel. The Human Science Research Council said the country would face a shortage of 20,000 accountants in 2003.
In February 2000 the Association of South African Quantity Surveyors warned that the emigration had weakened the organisation’s skills base to such an extent that it was "doubtful" whether the organisation could function effectively, especially in view of the growth in the construction sector.
There are also still opening for doctors in the public sector.
Section 9 of the Basic conditions of Employment Act of 1997 outline ordinary hours of work per week as forty-five (45), that is nine (9) hours out of every 24 hours for a five day working week and eight hours out of 24 hours if one works more than 5 days a week. Ordinary working hours may be extended by 15 Minutes per day if the two parties agree.
Overtime is regulated by Section 10 of the above mentioned Act. An employer may not permit an employee to work more overtime than three hours per day or ten hours per week and only in accordance with an agreement. Rates for overtime should be at least one and a half times the employees hourly rate.
All days listed in the public holidays Act must be granted. Work on a public holiday is entirely voluntary. An employee cannot be forced to work.
If a public holiday falls on a weekend (Saturday or Sunday) then the Monday following is a holiday.
Annual leave is discussed in Section 20 of the Employment Act. The annual leave cycle referred to her is a period of twelve months employment with the same employer.
An employer must grant an employee at least 21 consecutive days of annual leave on full pay with each annual cycle.
By agreement, one day of annual leave on full pay for every seventeen (17) days that the employee worked or was entitled to be paid.
An employee is entitled to take this annual leave on consecutive days and must be granted annual leave no later than six months after the end of the annual leave cycle.
An employee may not take annual leave together with any other leave (sick, maternity, etc.) or any period of notice of termination of employment.
Section 21 of the Employment Act outlines the payment of annual leave. Employers must pay employees leave pay at least equivalent to the renumeration that they would have received for working for a period equal to the period of annual leave. Annual leave pay must be paid before the beginning of the period of leave or by agreement, on the employees usual pay day.
This is outlined in section 22 of the Employment Act. The sick leave cycle refers to the period of thirty six (36) months employment with the same employer, immediately after the employee’s commencement of service or the completion of that employee’s previous sick leave cycle.
During every sick leave cycle an employee is entitled to paid sick leave equivalent to the number of days normally worked during a period of six weeks.
During the first six weeks of employment an employee is entitled to one (1) day of paid sick leave for every twenty six (26) days worked.
An employer can reduce the days of paid sick leave allowed in the first sick leave cycle by the number of days sick leave already taken in the cycle.
There are many employment agencies in the country. Some carter for the general labour market while others specialise in certain professions. There are many employment agencies in all major cities, specialising in German speaking personnel.
Below are some employment agencies that one can get in touch with:
| Contract Accountants (specialized in the placement of personnel in the financial professions) | Tel.: 021-659 4040 http://www.ca.co.za |
| Contract Personnel | 202 Schmitt Heights, Bill Bezuidenhout Avenue Tygervalley Tel.: 021-910 0433 E-mail: tygervalley@worldonline.co.za |
| The Resource Shop (TRS) Actuarial Opportunities (also do placements for Johannesburg) |
Tel.: 021-418 6780 E-mail: ct@resource.co.za |
| Quest Permanent Appointments | Tel.: 021-421 8445 |
| Kelly | |
| Claire Bourquin Recruitment Consultants | 2nd Floor Hill House 43 Somerset Road 8001 Green Point Tel.: 021-462 0301 http://www.cbrc.co.za |
| Accountants-on-Call | Tel.: 021-683 7740 |
| AD Mark Personnel Selection | Tel.: 021-689 5180 E-Mail: response@admark.co.za |
| Staffing Direct Recruitment Specialists | Tel.: 021-948 3451 / 3 |
| Greys UKUBAMBISANA Personnel Nationwide | Tel.: 021-425 3444 |
| Resource Match |
In 1996 60 % of the employed received incomes of R 1,500 or less per month and 10 % received incomes of R 6,000 per month , according to the 1996 population census.
| Income Group (R) | African | Colored, Indian White | White | Total Population |
| 1 to 499 | 18.3 % | 1.6 % | 0.3 % | 13.3 % |
| 500 to 899 | 28.8 % | 4.3 % | 1.2 % | 21.5 % |
| 900 to 1,399 | 21.7 % | 6.5 % | 2.5 % | 17.1 % |
| 1,400 to 2,499 | 15.4 % | 10.6 % | 6.2 % | 14.1 % |
| 6,000 to 9,999 | 2.9 % | 24.1 % | 29.5 % | 9.1 % |
| > 10,000 | 0.9 % | 24.4 % | 34.1 % | 7.9 % |
Employers are expected to pay 1 % Unemployment Insurance Fund Levy. The government plans to revise the conditions of the fund to include domestic workers, seasonal workers and farm workers as well as those earning more than R 93,000 a year.
The SMME sector is expected to increase its relative significance in the economy as a result of unemployment. Ntsika predicts that SMME will dominate South African tourism sector in the future, because the sector was "at the beginning of a long run growth process".
A company must register for Value added tax (VAT) if its annual turn over is R 300,000 or over. (Big News, June 2002. No. 65. p.5)
Several organisations offer information to the SMME sector in South Africa. The main government organisation charge with this responsibility is the Department of Trade and Industry (DTI). Here one can get information about:
Since approximately Summer 2002, this information can be accessed through the telephone by calling: 0861-843 384. A caller from anywhere in the country pays only the price of a local call and the Department pays the rest. One may also access information from the Department by going on their website: http://www.thedti.gov.za
Courses for the small business owner are offered by a variety of organisations ranging from private institutions, non-governmental organisations and even universities, technikons and technical colleges. These are advertised in the local newspapers, Career Times, BIG NEWS (which can be found at any library or any institution dealing with small business).
Below is a list of some of the institutions that offer such courses:
| Name of the Institution | Contact information | Courses offered |
| Damelin | Basic Bookkeeping for small business owners (Career Times,Monday, July 15, 2002.). | |
| Varsity College School of Business and Technology | source documents. Subsidiary journals. Cash receipts and cash payments. Debtors and creditors journals.
Posting to the debtors,creditors and general ledger. The preparation of the Trial balance from the general ledger
accounts. Income statement and Balance sheet items. Petty cash. Control accounts. VAT. Bank
reconciliation. Classes held once a week in the evening or on a Saturday morning over 11 weeks | |
| Cape Technikon | Tel.: 460 3079 / 3080 http://www.ctech.ac.za | Business Management / Entrepreneurship: Price: R 1,200. Basic Garment construction, Pattern making etc. |
Almost every bank in the country has a business section. Others such as ABSA, NedBank and First National Bank have a small Business department.
This is a program that helps small businesses with little or no collateral to get bank loans of below R 100,000. Small businesses that work through Sizanani do not only get bank loans but also get a mentor / advisor. The idea is that with the help of a mentor the risk of a small business failing or defaulting on its bank loan is decreased so much so that banks would be willing to lend to businesses without full security.
Tel.: 0861-333 000.
The major responsibility of this organisation is to ensure that micro-lending institutions are registered and lend in accordance with the Usury Act Exemption Notice of June 1999.
P.O. Box 2694
2004 Houghton
Tel.: 011-647 4400 / 0860-100 406
Fax: 011-647 440.
E mail: info@mfrc.co.za
http://www.mfrc.co.za
| website sponsored by: Bundesamt für die Anerkennung ausländischer Flüchtlinge (BAFl) through European Refugee Fund (ERF), and Zentralstelle für Arbeitsvermittlung (ZAV) through Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung (BMZ) |
| website administered by: AGEF gGmbH, Berlin, info@agef.de , www.reintegration.net, www.agef.net |