South Africa lost 4.9 million workdays from strikes in 2023

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In 2023, South Africa lost 4.9 million workdays due to industrial action, which significantly impacted workers’ productivity and, subsequently, economic activity.

This was revealed by the South African Reserve Bank in its first Quarterly Bulletin for 2024, using research from Andrew Levy Employment Publications.

This could be attributed largely to the nationwide public sector strike in March 2023 and the prolonged municipal workers’ strike in July 2023.

The number of working days lost in 2023 more than doubled from 2022, reaching 4.9 million days compared to 2.4 million.

Lost workdays are the number of days that an employee would have worked but did not for reasons other than injury, illness or disease. In this case, this is limited to days not worked due to strike action.

To reach a figure of 4.9 million, the number of workdays lost to strike action is multiplied by the number of employees involved.

For example, if ten workers went on strike for ten days, that would amount to 100 workdays lost.

Many strikes in South Africa occur as part of negotiations around salary increases for union workers, with industrial action being a tactic to get the desired increase or benefits.

This has increasingly occurred in the public sector, with unions lobbying the government for better increases while the state is unwilling to increase the large public sector wage bill.

Another common precursor to widespread industrial action is wage negotiations in the country’s mining sector, where tools are often downed to draw concessions from management.

Mining companies have increasingly turned to negotiating longer-term agreements with workers, typically around five years, to avoid annual disruptions to their operations.

Industrial action has been an effective bargaining tool, with the average wage settlement from collective bargaining agreements rising 6.3% in 2023.

However, this has a negative effect on worker productivity, which has been stagnant in South Africa for the past 15 years.

South Africa’s productivity has remained flat for the past 15 years, at just over R200,000 of GDP created per employed worker.

Financial services firm PwC revealed this in its South Africa Economic Outlook for March 2024, outlining the country’s ailing productivity.

Productivity is vital for any economy as it allows countries to produce more goods and services with the same or less resources.

PwC said it plays a crucial role in bolstering employment opportunities, leading to better wages and improved economic conditions for individuals at the household level and nationwide.

The typical measure to analyse a country’s productivity is its real GDP per employed worker, which evaluates workers’ output.

South Africa’s productivity, according to this metric, has shown no net gain between 2015 and 2023, with only marginal gains since 2008.

From 2008 to 2023, the GDP output per employed worker has hovered around R200,000 per year with some peaks and troughs.

source:https://dailyinvestor.com/south-africa/49068/south-africa-lost-4-9-million-workdays-from-strikes-in-2023/

Natalie