Labour Vanguard

According to City Press, the labour broking industry is pleased with new research that seems to tag it as a cornerstone of the economy and a means of relief to the poor.

The research in question was presented by University of Cape Town economics professor Haroon Bhorat at an event organised by labour broker lobby group - the Confederation of Associations in the Private Employment Sector (CAPES.)

Bhorat estimates:

970,000 brokered employees worked in SA in the first quarter of this year, up from 810,000 in 2011.

In 1995, there were just 199,000 brokered employees.

The broking headcount has grown at 8.7% on average each year since 1995.

Overall employment only grew by 2.5% a year, so about 14% of the 5.6 million additional jobs since 1995 have been brokered jobs.

CAPES claims the TES (Temporary Employment Service) industry has created more jobs in SA than any other sector since 1995.

TES is however strongly criticised. One of the main arguments against labour broking is that it doesn’t in fact create jobs as it only mediates between the worker and the employer – who would still need to hire the worker, regardless of the broker’s intervention. Bhorat concedes that it would be impossible to calculate how many of the close on one million brokered employees would be employed in the absence of the labour brokers.

The argument doesn’t end there though, as brokered workers generally get paid less than permanent staff; the brokers insist that the absence of TES industry would reduce demand for labour.

In general:

The wage “penalty” for brokered workers is around 35% across all sectors

This penalty sits at 17% in the manufacturing sector

48% of brokered workers have no pension

36% of permanent employees have no pension

84% of brokered workers have no health insurance

60% of formal sector workers have no health insurance