BL Premium reports that Agri SA, a federation of agricultural organisations, says the national minimum wage (NMW) of R21.69 per hour — which came into effect on Monday — could result in the loss of more than 4,000 jobs in the agricultural sector.
Agriculture is considered one of the beacons of the economy, contributing about 3% to GDP and employing about 900,000 people. On 1 March, minimum wages of farmworkers increased 16% from R18.68 an hour to match the broader NMW of R21.69, which is up 4.5% from 2020. Agri SA’s Christo van der Rheede said that according to a desktop survey they conducted on the impact of the new minimum wage, 549 out of 577 participants indicated that due to the new rate they would exceed their allocated budget for wages in 2021. He said they foresaw a 24% increase in wage costs over turnover for 2021. Of the 577 participants surveyed, 456 foresaw retrenchments of their farmworkers as a direct result of the new minimum wage. “This data indicates that there is the potential of 4,384 jobs to be lost amongst the 456 participants, meaning that 9.6 workers per participant run the risk of losing their jobs,” Agri SA indicated. Participants further indicated that the retrenchments would mostly impact seasonal/casual workers. Subsectors that remain labour intensive will consider mechanising processes that will reduce staff numbers and shorten working hours of retained workers.
- Read the full original of the report in the above regard by Luyolo Mkentane at BusinessLive (paywall access only)
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