Opposition to proposed minimum wage

A proposed national minimum wage of R3 500 per month or R20 per hour was a double-edged sword that could lead to job losses.

While there has been much support for the proposed minimum wage announced by Deputy President Cyril Ramaphosa, opponents claim that it will lead to job losses as employers struggle to meet the new benchmark.

Dustin Cooper, a farmer in Kearsney outside Ballito, said it was a “double edged sword”.

“There is a misconception that farmers don’t want to pay their labourers a fair wage,” said Cooper.

“We want to pay, but when we struggle to afford the wages it means we will have to employ fewer people.”

Ramaphosa’s proposal is that the minimum apply across the board, with special provisions for agriculture and domestics.

In the agriculture sector the proposed minimum is 90% of R3 500 (or R3 150), while the domestic worker sector is 75% of R3 500 (or R2 625).

“Farmers have a capped income. We can’t simply diversify in order to increase our income,” said Cooper.

“This new minimum wage could mean that we have to cut down on staff and reduce the hours that they work, in order to afford the wages.

“This development is going to lead to job losses in the agricultural sector.”

Cooper’s assertions echo many similar objections, that while the minimum wage seems to be a positive development on the surface, it could seriously impact South Africa’s productivity and lead to job losses as employers try to absorb the impact of higher wages by decreasing hours worked and letting workers go.

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