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Labour unrest could harm the economy, expert warns

Tue, 28 August 2012

Ongoing labour unrest, especially in mining, could see South Africa’s Gross Domestic Product drop another percentage point this year, Liza van Wyk, CEO of AstroTech Training in Parktown, Johannesburg said. She believed that it would be as low as two percent or even 1.5 percent.

The International Monetary Fund in its August country analysis of South Africa observed how labor unrest in mining and manufacturing pushed down GDP one percent last year. But the situation has been even worse this year, and is still volatile; unless companies and government start managing the situation better we will see at least a point, or a point and a half lopped off an already weak GDP.

The IMF predicts in its report that South Africa’s GDP would be just three percent this year. But their report was written well before Marikana. I believe GDP could be as low as two percent, or just one and a half percent, which means that the economy is essentially stagnating.

“The IMF pointed to shortfalls in infrastructure as constraining employment and growth too, and yet we see too little in the form of infrastructural - or job-creating - projects coming from government and the private sector,” Van Wyk said.

The IMF predicted: “Impatience with the high structural unemployment, particularly of the young, could lead to inappropriate responses that might threaten macroeconomic stability. In addition, adverse external developments and domestic shocks could increase further unacceptably high levels of unemployment.”

Van Wyk said, “Unfortunately we are on track to meet, or exceed, the worst predictions unless we begin turning things around rapidly.” It seems employers are trying to do just that.
She said that AstroTech Training, which trains thousands of middle managers and executives each year, had seen increased levels of interest in courses around conflict management and emotional intelligence or EQ since the Marikana killings.

“Employers are concerned about high levels of tension. Strike season in South Africa usually runs from May to September, but there is considerable concern that workplace discord could remain until after the African National Conference’s Policy Conference at Mangaung in December.

“Employers are trying to handle these events more empathetically in an effort to dampen anger as far as they can, and to ensure harmony and productivity in the workplace.”

But Van Wyk said employers’ felt bedeviled by circumstances beyond their control. “They cannot improve service delivery, better education systems, improve roads or transport. More productive employees can help keep production costs down, which would lead to lower inflation and better prices, but it’s a difficult message to get through at present.”

She quoted EQ guru Daniel Goleman who says that the key to motivation “is your level of optimism or pessimism. It can be defined as fully understanding the reasons for a set-back and placing appropriate responsibility upon ourselves and things external to us (clients, circumstances, etc.); and developing an understanding of the learned optimism or learned helplessness that typifies a response.”

Van Wyk said that, “There is no doubt that the Marikana situation spiraled because those involved lacked the right levels of emotional intelligence or EQ. Key skills are empathy and social skills. Without a strong sense of who we are, the ability to regulate our behavior, and a healthy level of optimism and motivation, our ability to develop these competencies is diminished.

“South Africa’s low productivity is a factor of employers and employees who show high levels of pessimism. If you don’t believe in tomorrow, you’re not going to work hard for a better future.

“Many conflict resolution professionals believe that emotion hinders the process and so in negotiations people show a straight face, when in fact successful negotiations require an empathetic approach. A bland face can be interpreted as a boss who doesn’t care.

“Goleman says that controlling actions can be felt as disrespectful, disempowering, uncompassionate, and sometimes shaming. A key in developing skills to work with emotion is increasing our comfort with emotion.

“Goleman notes that emotion is what non-verbal communication is made of and therefore, if we ignore the emotion, we also ignore more than 90% of human communication. We have also discovered that if we fail to acknowledge emotion or prevent its revelation, the emotion in the room increases.”

Source:
Labour unrest could harm the economy, expert warns - www.skillsportal.co.za