HomeOpinionEric Bloch: Growing Employer, Labour Divide

Eric Bloch: Growing Employer, Labour Divide

ZIMBABWE’S economic recovery is confronted by innumerable constraints. Although it is indisputable that there has been some tentative progress towards the recovery intensely yearned for by virtually all Zimbabweans, progress has been relatively minimal as compared to that so critically needed.

Much is needed to accelerate that recovery, and amongst the many necessary developments to bring about a substantive economic upturn is a unity of purpose and constructive interaction between employers and labour. Regrettably, not only does that not presently exist — save in a few exceptional instances — but the actuality is that there is an increasing divide between them.

Reactive to the pronounced hardships which afflict almost all Zimbabweans, most of the approximately 10% of the employable population as is engaged in formal sector employment have regard virtually exclusively to the quantum of their remuneration.

Not only do they need to provide for themselves and for their immediate families, but also for very many other dependants. Poverty is so widespread in Zimbabwe, with more than four-fifths of the population battling to survive on incomes below the Poverty Datum Line (PDL), that those who are in gainful employment have vast numbers reliant upon them for some sustenance.

The very great numbers of dependants of the employed include thousands of Aids widows and orphans, many persons who are very aged, and large numbers whose health has been grievously eroded, often as a result of malnutrition and inadequate access to healthcare.

As a result, with rare exception, employees’ focus is centred almost in the entirety upon the extent of their wages or salaries, with a primary determination that the amount thereof must exceed the PDL.

 

Not only is there no regard for the ability or otherwise of employers to pay remuneration matching the employee needs and expectations, but concurrently employee performance levels are generally declining.

 

This is unsurprising, for the employee is continuously mindful of financial needs, to the exclusion of virtually all else. In all probability, he (or she) has walked a considerable distance to work, having been unable to afford public transport, and has had done so without preceding that extended walk without any nutritional meal.

 

Throughout that tedious and stressful journey, and thereafter throughout the day, the employees’ thoughts are centred almost wholly not upon employment duties, but upon how to fund essentials.

 

The concerns centre upon how to feed themselves, their families and dependants, how to pay residential rentals and utility charges, funding of children’s education, meeting essential healthcare needs, and much else.

 

So intensively are the endless thoughts upon the desperate cost of living burdens afflicting them, that minimal focus is upon their employment duties, with consequential inadequate productivity, and low performance.

Concurrently, a very great number of workers, and especially the trade unionists that represent them, are convinced that employers have the resources with which to pay markedly greater wages and salaries, and refrain from doing so only because of lack of concern for the wellbeing of the workers and their families, and because they are driven by determination to realise ongoing “super profits”.

 

Whilst undoubtedly there are some instances where these perceptions have some substance, the realities are that most employers are doubly concerned for the wellbeing of their workers, and that far from making vast profits, their enterprises are struggling to survive.

 

Almost all employers are conscious of their employees’ grievous financial stresses, and attendant pressures, and are highly desirous of addressing and alleviating those stresses and pressures, insofar as possible. But, at the same time, the employers are very necessarily anxious to ensure the survival of their businesses, and restoration of viability to the enterprises.

Employers and workers alike must appreciate each other’s circumstances, and at one time that was so. But now, with very rare exception, labour does not, and this is especially so in the case of many (but not all) of the trade union leaders who represent the workers in wage negotiations.

The hardships that constantly torment the workers are so great that the need to minimise those hardships renders labour oblivious to business and economic realities, and motivates disbelief of any employer representations.

 

And, although business strives to be understanding of labour’s circumstances, that understanding is being progressively eroded by recurrent labour confrontationalism, by obduracy and dogmatisation, and by frequent threats of industrial action, as well as by the consequences of the diminishing productivity, and by labour’s resistance to recognise realities.

If the prevailing stance of trade unionists and other negotiations on behalf of labour is not to reverse the recently commenced economic recovery, and is not to preclude the further recovery so very greatly needed by all Zimbabwe, then they need to give recognition to:

  • The mutual need of employers and employees alike for the businesses to

survive, develop and grow;

  • The harsh fact that most businesses are struggling to survive. Their working capital

resources have been massively eroded by losses sustained during the 2006 to 2008 hyperinflation era, and thereafter by the demonetisation of Zimbabwean currency, albeit that that demonetisation was necessary. Moreover, because of the magnitude of present financial sector illiquidity, recourse to new working capital inflows is very minimal indeed, intensifying the survival vulnerability of very many enterprises.

  • As an inevitable result of limited consumer spending power, exacerbated by the pronounced insufficiency of currency in circulation, consumer spending power is minimal, as a result of which there is minimal demand for most products  marketed by commerce and industry, which considerably minimises sales volumes, and therefore business revenue inflows, which in turn restricts ability to enhance worker remuneration;
  • Industry’s sales volumes are also markedly contained by extensive export market

price competitiveness, as most manufacturers external of Zimbabwe are able to be very price competitive,  enjoying the benefits of economies of scale, attained from high production volumes, and of very greatly lower costs of wages, and of utility charges, as well as very much lesser interest rates on financial sector borrowings;

  • Productivity enhancement would facilitate payment of higher wages.

In addition, the trade unions need, very belatedly, to recognise that as distressing as their members’ circumstances are, the members are nevertheless better off earning some income, however inadequate it may be, than to earn nothing, as a result of loss of employment. It is better to earn too little, than to earn nothing!

Continuing demand for unsustainable wages can only result in many businesses downsizing, and many more closing down (as has recently been the case of Cotton Printers and of David Whitehead, amongst many others). That results in further contraction of numbers employed, with consequential intensification of poverty.

To all intents and purposes, by their obdurate and dogmatic, uncompromising negotiating stance, many of the trade unions are not only doing a disservice to their members, but concurrently are committing suicide, for the magnitude of membership loss due to diminished members employed must bring about the financial and operating collapse of those unions.

 

By Eric Bloch

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