BL Premium reports that in a development that could lead to huge job losses and food inflation, SA’s commercial farmers have threatened to close all labour intensive divisions and switch to mechanisation to produce food.
This indication came after Department of Employment & Labour Minister Thulas Nxesi’s decision to hike farm workers’ minimum salaries by 16%. Agriculture contributes about 3% to GDP and is responsible for about 900,000 jobs. The Transvaal Agricultural Union of SA (TAU SA), mega farmers, and other agricultural stakeholders held a meeting at the weekend to discuss the implications of the new national minimum wage of R21.69 an hour that will come into effect on 1 March. The meeting followed Nxesi’s announcement in the Government Gazette last week that farm workers’ wages would be increased from R18.68 an hour to match the broader national minimum wage of R21.69, which itself is up 4.5% from 2020. TAU SA president Henry Geldenhuys said on Saturday that the feedback from a wide range of farmers and other role players in the sector’s value chain was that they would be forced to make some “amendments” in their operations to accommodate the new changes. “Unfortunately, most of them have decided to close all labour intensive divisions like growing vegetables to switch to more mechanised ways of producing food,” Geldenhuys indicated. He went on to say: “Agriculture will declare a dispute with the minister of labour & employment regarding the irrational announcement. In this regard [we] will ask [Nxesi] — during an official meeting — to put the minimum wage on ice until the dispute can be settled.”
- Read the full original of the report in the above regard by Luyolo Mkentane at BusinessLive (paywall access only)
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