We are far more likely to beat poverty if we stop trying to peddle fantasies about what our economy can achieve.
The National Planning Commission’s revised National Development Plan is very long and detailed – so detailed and wide-ranging that we will all find parts we support and others which we reject. In general, the plan contains valuable suggestions for how to move the country forward. But the document’s claims about job creation peddle a fantasy which is likely to prevent us tackling poverty.
Like most who take part in our economic debate, the commission claims to have a recipe that will end unemployment. It says it can cut joblessness to 6% in 2030 by creating 11 million jobs. This would almost get rid of unemployment in less than 20 years.
The only problem with this target is that it will not be achieved. This is not because there is something very wrong with the commission’s proposals but because no one has a formula which can virtually get rid of unemployment here in a couple of decades – or, for that matter, the lifetimes of most of us.
When the commission or anyone else promises their formula will ensure that virtually all of us will have a job, they do not mean that everyone will be able to sell apples on street corners, they mean everyone will work for a formal employer. This is not realistic.
The first reason is that its key proposed solution will take time to work.
It rightly identifies our education system as a key barrier to job creation. One of our key problems is that we have a post-industrial economy and a pre-industrial education system. Most of the jobs we create are in “knowledge economy” activities such as information technology or financial services, but most of our citizens emerge from school unqualified for this work. The commission is right to want to fix education. But it seems to ignore the reality that improvements in education take years to make an impact.
More importantly, it also does not recognise that, even if we miraculously fix our education system, millions of jobs would not be created. Businesses have found ways of using machines to cut down on labour – they are not going to throw them away if we adopt new policies.
This is why the many voices who tell us that their plan would create the formal jobs we need to get rid of unemployment are leading us down a blind alley. No one, whatever their politics and however good they are at economics, can come up with a plan to get rid of unemployment any time soon because the task is impossible. For many years, whatever policy we adopt, millions of our fellow citizens will be without formal jobs.
This need not be disastrous, for there is much we could do to ensure that people without formal jobs live productive lives.
One example is the social grants which have played so important a role in so many people’s lives. Those who promise jobs for all do not like the grants because they say they force the poor to rely on the well-off. It would be better, they add, to ensure that people have jobs.
While this argument may sound good, it is sure to do great damage. Grants play a vital role in enabling millions of people to join the economic mainstream – they allow people who would otherwise be unable to do so to buy and sell and this boosts businesses. The fantasy which says that we must ensure the poor have jobs rather than grants could lead us to deprive people of resources which they and the economy badly need – but to offer them nothing in return because the promised jobs will never come.
This attitude also blinds us to the talents and energies of many of our citizens. The illusion that we will all have a job in a formal workplace one day is fuelled by a prejudice which says that only work done in formal businesses is a real job. And so the thousands who make a living in all sorts of ways on our streets and in those places where formal businesses do not go are seen not as assets to our economy and society, but as shameful embarrassments. Which is why, as we continue to talk of small business creation, authorities in Johannesburg continue to chase traders off the streets. To them, a person who owns a supermarket is a wealth creator – someone who does the same selling in a backyard or on the street is a law breaker.
Many of those who claim to have found formulaes which will enable us to create jobs for all, no doubt believe their theories are sincere attempts to fight poverty. In reality, the opposition to grants and to informal producing and trading stems from the prejudice that the way in which a minority makes money in carpeted offices is the only way. This may also go hand in hand with a deep mistrust of the ability of poor people to take wise decisions. Why else continually find fault with the way they spend their grants or earn their living?
The way to fight poverty is not to place obstacles in the path of the millions who find ways of surviving without a formal job. It lies in supporting them – not only by not harassing them but by offering them facilities and resources so they can improve what they do.
It is surely time our economic debates realise what millions of people at the grassroots of our society have known for years; that working outside the formal workplace is not only possible, but can also be a source of dignity and productive work which helps secure our future.
- Steven Friedman is director at the Centre for the Study of Democracy, Rhodes University and University of Johannesburg. This article was published on The New Age.