South Africa’s Finance Minister Pravin Gordhan appealed to the business community to not take the “easy way out” and downsize staff when times become difficult, as that will further hinder the country’s growth.
Business has to have “the confidence to invest in the current environment and ensure that you don’t take the easy route out when in difficulty, i.e. cut staff, because unemployment is our collective challenge, you and ourselves need to do as much as possible to keep as many workers at work,” Gordhan said.
This comes on the back of the recent alarming unemployment numbers revealed by the country’s statistics agency.
Figures showed South Africa’s unemployment rate surged by 2.2 per cent in the first quarter of 2016 to 26.7 per cent, all the while shedding 15 000 jobs in most sectors.
The minister told this to the business and media at an engagement on collective ways of dealing with the economy hosted by the South African Chamber of Commerce and Industry, where he added that particularly labour and business need to work hard at ensuring that they do not increase the number of unemployed people in South Africa.
Minister Gordhan also emphasised the need for the country to show ratings agencies “results” in order to avoid a downgrade.
“In the next few months we have to collectively deliver another set of concrete initiatives and results which will persuade ratings agencies that what we said in the first six months of this year is in fact being delivered in the next six months of this year,” Gordhan said.
He adds: “Whilst recognising that growth is not something that you can click your finger and deliver what investors and the ratings agencies and our own 55 million people in South Africa want to see is that we are doing enough as government to be supportive to the growth environment.”