DEI On Racial Steroids
The IMF ranked South Africa as the 49th country globally for ease of business and it correlates directly with the high unemployment rates and stagnant economy.
When we look at this graph it is easy to see why South Africa's economy has stagnated resulting in the country leading the highest unemployment statistics world wide. Regulation is an investor and job killer and with the new Employment Equity Act many predict the unemployment numbers will rise even further.
Remove the regulations and the economy would grow at double the speed immediately. Investors would see opportunity and jobs would return. State Owned Enterprises operate as a monopoly even though they are failing with no competition as they are protected and any competition is deemed illegal.
The new Employment regulations are going to take SA from an already bad place into a worse place and this is obvious to see. The regulations state that companies/businesses who have more than 50 employees must represent the demographics of the country within the next 5 years. Each year these businesses will be scored on their progress and if they are deemed to be too slow they will be fined. If these numbers are not achieved within the 5 year period then those companies will be fined upwards of 10% of total revenue.
The fix is rather easy if you have a business with 45 people as you just do not hire anyone else and on the same thought if you have a staff compliment of 60 people you lose 11 immediately. This is common sense as red tape and regulation is easy to avoid if you can. Companies or businesses with a far bigger work force can change by retrenching and outsourcing which will stay make them compliant. The other method is to split the company into smaller subsidiaries with 45 or so employees per subsidiary.
The biggest problem I foresee is the government can change these numbers and they could downsize these to 30 or even 20 if what they see is not working out as they had expected. All this will do is escalate the unemployment in the country further and crash the economy. Is the government trying to solve the unemployment problem or are they doing this to generate revenue from fines instead?
When you employ an individual it should not be on race, but on is the candidate the right person for the job and does he/she add to the business. The skills or experience they bring especially to a company with aspirations of succeeding and growing. AI fortunately is going to kill so many jobs and it needs to be happening now and I can assure you this will guarantee to speed up the process.
Investors will not be lining up to invest into the economy either and those that have will be looking at the exit doors. If I was forced to reduce the business by splitting it into two or three I will and if that is deemed illegal I would shut the business down no matter how good the business was and work on my own. The workers will be the ones to suffer and surely this is what the Employment Equities Act is trying to protect yet they are going to make matters worse leaving the workers vulnerable.
I have not delved into the numbers of exactly what the make up of companies is expected to be, but if the white population has a demographic of 5% how can you force companies to only have 5 white employees for every 100. In our business we employ my entire family and that is never going to change. Just imagine a dad bringing his son into a business and being told he cannot do that because of the racial numbers which is just a sick way to even think.
Businesses are going to struggle and this could be the breaking point that sees a larger exodus of companies calling it a day and moving on making the economy crash far quicker than expected. I would walk away tomorrow and close the doors permanently if forced into a corner and move to a country without such stupid employment laws. I know I am not alone in thinking like this as I know of at least 10 other businesses who are larger than ours monitoring the situation ready to pull the plug.
Posted Using INLEO
