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Eroding the Core: Flexibility and the Re-Segmentation of the South African Labour Market

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Bridget Kenny; Edward Webster (1998). Eroding the Core: Flexibility and the Re-Segmentation of the South African Labour Market. Critical Sociology 24(3). SAGE Publications.
Type journal article
Scope Post-1994 South African economy
Method mixed
Period studied 1979–1998
Regions South Africa, Gauteng gold and coal mining, urban retail
Themes labour markets wages, unions strikes, mining migrant labour, transition post apartheid, inequality poverty unemployment, origins segregation
Citation key kenny1998

Argument

Employers are pushing 'flexiwork' (casualisation and subcontracting) in the post-apartheid era to cut labour costs and roll back the shopfloor rights won by the black union movement since the 1970s. Together with high unemployment and the racial segmentation inherited from apartheid, this is re-segmenting the labour market. The new divide is between a core of black and white permanent workers, who are themselves increasingly insecure, and a growing periphery of insecure flexiworkers. The argument rests on two case studies, subcontracting in mining and casualisation in retail, set against the 1995 Labour Relations Act and the business push for a two-tier labour market. The authors conclude that unions have not yet found innovative responses.

Evidence and method

Interviews with NUM members, Chamber of Mines and mining contractors (subcontracting research with Bezuidenhout). Focus groups and interviews with 30 permanent and 46 casual workers at one pseudonymous retail branch (Megacity). Secondary statistics from the Department of Labour, Standing et al. (1996), NALEDI/Rees, the Reserve Bank Quarterly Bulletin, the South African Foundation, COSATU and the September Commission, and the Enterprise Flexibility Survey.

Findings

  • Business lobbied for a two-tier labour market that would exempt the new tier from minimum standards. (p. 4)

    the existing high-wage capital-intensive low-employment sector, and a burgeoning free-entry labour-intensive sector with strong new investment

  • Gold mining shed labour sharply as the gold price fell. (p. 9)

    In 1987 the Chamber of Mines affiliated gold mines employed some 500,000 workers; by March 1994 they employed 300,839 workers

  • Subcontracting grew rapidly in gold mining. (p. 9)

    Subcontracted employment in the gold mining industry increased from 3% in 1987 to 10% of the total workforce in 1994.

  • Subcontracting grew even faster in coal mining. (p. 9)

    In 1987, 5% of workers in South African coal mines were employed by subcontractors. By 1994 this figure rose to 16%.

  • Subcontracting has moved from specialised and non-core functions into core underground work, as retrenchments created a pool of skilled labour that could be contracted back more cheaply. (p. 9)

    Most recently, subcontracting has moved into core mining work.

  • Mine hostel separation and non-unionisation of subcontract workers undermine solidarity with the NUM. (p. 11)

    Furthermore, mines and contractors intentionally have kept apart subcontracted workers and permanent workers in order to encourage the perception of 'different interests'

  • In retail, casual employment rose while full-time employment fell. (p. 14)

    While full-time employment in retail fell by about 1 % between 1987 and 1997, casual employment showed an increase of 44.7% in the same time period

  • Casual retail workers earn far less than permanent workers and receive no benefits. (p. 17)

    In general permanent staff made anywhere from 32% to 79% more in basic wages than casual workers.

  • Casual workers are only weakly represented by the union. (p. 22)

    Research conducted shows that 90% of permanent workers interviewed were members of Saccawu, while 37% of casual workers interviewed called themselves 'members'.

  • Flexibilisation is entrenching the position of the 'old losers' and shifting the costs of reproduction onto them. (p. 26)

    the resegmentation of the labour market is entrenching the position of the 'old losers'—the unemployed, informal sector, and migrant workers.

  • Labour productivity growth has come with job losses and not through innovation. (p. 6)

    This productivity increase seems to be the result of the reduction in the number of employees in establishments rather than innovation.