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Workers Grapple With Inflation

TEMBA Mano has been a chairman of the worker’s committee at a local gold mining company for the past three years.


For a mere clerk this has been huge a responsibility but he has managed well thus far.

Using a combination of threats and persuasion Mano has managed to get some significant concessions from the management.

“Things were fine. We were getting something from the company,” Mano said.

However his fortunes took a nasty turn three months ago.

“No matter what figure we proposed it was immediately wiped out by inflation. The workers started blaming me for being a weakling. They were never satisfied with any amount that we got from the company.”

The final straw came three weeks ago.

On June 3 Mano had a meeting with management to negotiate salaries for the month. The workers were pushing for a minimum wage of $80 billion.

Managers winged for a while but the demands of the workers prevailed because they were threatening to strike.

“It was a done deal and the workers seemed happy because at that time it looked like a decent figure. Then prices started flying,” recalls Mano.

Under pressure from workers Mano went back to the management on Monday this week to tell them that the salaries they approved at the June 3 meeting were no longer enough.

“The management said the salary schedules had been sent to the head office for processing. They said I was negotiating in bad faith. They refused to hear our demands,” Mano said.

Because of his little training in salary negotiations he understood that the workers were not going to succeed in their demands. He went back to the workers with the sad news. The workers were hostile.

“They told me that I had been bribed by the management. I quit immediately.”

There is also Chido Munyati (30), a senior teacher at a Harare school. She got paid on Wednesday this week.

Government increased her salary from $6 billion to $73 billion last month. Before the review her salary could only buy four litres of cooking oil.

The review looked huge at that time but the problem was that before she could receive the salary inflation had started gnarling at it.

By the time she received her salary it was enough to buy only two litres of cooking oil.

“It is no longer making sense at all. I am back to square one,” said Munyati who has been a teacher for the past 11 years.

This dire situation is what workers face in Zimbabwe today. No salary increment is enough in a country where inflation is 1 700 000%.

Munyati will receive her next salary on July 17 and by that time she will not be able to buy 500 ml of cooking oil.

The Zimbabwean dollar has been losing value at a rate of 25% per week, according to bank economists. This makes it difficult to negotiate salaries. Relations between workers and employers have been strained.

The problem is affecting both the workers and employers. Companies are battling to retain workers. Workers are struggling to wring decent salaries from companies that are already on the verge of collapse.

The bigger problem is how to balance between retention of workers with better salaries and still keep the companies running.

Employers Confederation of Zimbabwe (Emcoz) said the situation has become unbearable as the economic environment is no longer conducive businesspeople.

“The situation is truly difficult and both employers and employees don’t know what to do anymore,” said John Mufukari, director of Emcoz.

“The transport issue is the most difficult for most employees as transport costs are going up on a weekly if not on a daily basis, even for those who have their own transport, fuel companies are now demanding payment in foreign currency which most companies do not have.”

Mufukari said negotiations have increasingly become hard because businesses cannot budget or plan ahead.

“In an environment where one can plan ahead, life becomes easier but at the moment, the situation in Zimbabwe is not feasible as prices are going up on a daily basis. One only needs to look at the interbank rate to understand what is going on,” Mufukari said. Economic analyst, Godfrey Kanyenze said: “Observations have shown that agreements on salaries are way below the poverty datum line, the average worker is earning far below that which is enough to sustain livelihood. Some companies which have the means have been topping up and providing other coping strategies which are being designed to preserve the value of the purchasing power.”

According said Kanyenze some companies were now paying workers more than once. Kingdom Bank has been paying workers twice a month for sometime now.

Edgars is planning to follow suit.

“Some companies are now offering transport for their workers vouchers for groceries and canteen facilities so that people may eat at work at subsidised prices, all these are coping strategies which are being implemented to mitigate against inflation,” said Kanyeze.

Some players in the industry blamed the liberalisation of the foreign exchange rate for the rise in food prices.

“We are now beginning to see that the liberalisation did not bring the solution we hoped for. It is not only about monetary policies. The fiscal policies also need to be revisited,” said Mufukari.

Zimbabwe Congress of Trade Unions (ZCTU)’s acting information officer, Last Tarabuku, said the situation was now desperate for workers.

He blamed the government’s income tax regime for worsening the situation.

“Times are hard because negotiating has become difficult. Even if one negotiates a good salary today, 50% is taken away by taxes and the remainder is absorbed by the inflationary environment,” said Tarabuku.

“The economy is the problem and there is nothing much that can be done to solve the crisis until and when the economy is put back on the right track,” Tarabuku said.

Civil servants are the most affected.

Progressive Teacher’s Union of Zimbabwe (PTUZ) said they have never known what negotiations are because government has never taken them seriously.

“We should be cushioned, we have always called for salaries to be reviewed quarterly but it is no longer feasible, at least they should be reviewed monthly,” said Ladistous Zunde, national treasurer for PTUZ.

“We don’t mind being paid on a daily basis as long as we are covered, we need a living wage and we are not looking at anything less than a trillion, because we are also caught in the web of poverty and inflation. What we want is $4 trillion.”

By Jeslyn Dendere

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