BUSINESS MAVERICK ANALYSIS: Lesson from Marikana: The other side of above-inflation pay rises

  • 📰 dailymaverick
  • ⏱ Reading Time:
  • 69 sec. here
  • 3 min. at publisher
  • 📊 Quality Score:
  • News: 31%
  • Publisher: 84%

United States News News

United States United States Latest News,United States United States Headlines

BUSINESS MAVERICK ANALYSIS: Lesson from Marikana: The other side of above-inflation pay rises By Ed Stoddard

Platinum wage talks are upon us again and the Association of Mineworkers and Construction Union is in fighting mode, with demands for raises of up to 50%. One of the factors often cited to explain this militancy is worker debt and the garnishee orders that are enforced for compliance, which can see much of a miner’s monthly pay diverted to creditors.

One of the items that catches the eye is the pay raises that were agreed upon in the decade before the mayhem. Off a very low base, from 2003 to 2011, Lonmin’s rock-drill operators – who became AMCU’s core support base – received above-inflation wage increases every single year, which often meant double-digit hikes. Some years the gap was not big – in 2007, their pay rise was 10%, while average CPI inflation that year was 9%. But in 2008, when CPI averaged 9.5%, they got an 18.

What appears to have been unfolding – and this, admittedly, is a hunch – is that successive wage growth that accelerated beyond inflation provided many of these miners with, probably for the first time in their lives, a measure of discretionary or disposable income. For decades, South Africa’s mostly migrant mine labour force had been paid wages that only provided for a subsistence existence, a basic supplement to the subsistence farming carried on by their families back in the rural homelands.

This may have created a vicious cycle – wage growth that enabled workers to finally buy stuff, which in turn pushed them into crushing levels of debt, which in turn spurred their demand for even higher increases. Rising living standards can come at a price, especially for a workforce that finds this new world of predatory finance and credit difficult to navigate.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 3. in US

United States United States Latest News, United States United States Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

BUSINESS MAVERICK: FIFA to pump millions into South Africa and kickstart amateur football economyA seismic change is about to take place in the funding of amateur soccer clubs by Fifa, and SA clubs need to make sure they are in a position to benefit. I believe they should start with pumping more money into female soccer development!!! Who is controlling the money? In my opinion keep it very far away from Danny Jordaan, also keep him far away from women.
Source: dailymaverick - 🏆 3. / 84 Read more »

Business Maverick: US and China’s top trade officials make first contact since truceUS Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin spoke on the phone with their Chinese counterparts, marking the first high-level contact after their presidents agreed to resume trade talks last month.
Source: dailymaverick - 🏆 3. / 84 Read more »

Business Maverick: London beats New York in attracting Saudi ETF billionsInvestors betting on Saudi Arabian shares are showing a clear preference for funds listed in Europe over the U.S. The contrasting picture may come down to which market offers lower fees and more attractive treatment on taxes and dividends.
Source: dailymaverick - 🏆 3. / 84 Read more »

Business Maverick: Doubts over Deutsche Bank turnaround plan shake sharesDeutsche Bank shares extended losses on Tuesday on investor doubts that its chief executive can revive the lender by shrinking the investment bank and returning to its roots as banker to corporate Germany.
Source: dailymaverick - 🏆 3. / 84 Read more »

BUSINESS MAVERICK: Listen up: There is profit in podcastingIt has never been easier or cheaper to start an online radio show or a podcast. There are already 700,000 podcast producers around the world. There is no red tape, and legacy issues of analogue don’t apply. But most importantly, there is money to be made.
Source: dailymaverick - 🏆 3. / 84 Read more »