Political Economy Alternatives

AIDC’s political economy programme is aimed at developing alternative perspectives in the field of Eco policy alternatives: i.e. both economic and ecological. We do this in the context of the global crisis and its impact on South Africa and the region as well as growing inequality in South Africa and the associated mass unemployment crisis and the impact this has for the region.

South Africa faces a huge crisis of unemployment. The economy is creating fewer jobs than the number of new people that enter the work force. As shown by official GDP statistics, ever since the end of apartheid profits share of national income has increased over the wage share. Instead of investing the increased profits into creating jobs the greatest proportion has either been invested in speculative investment in the financial sector or invested out of the country. Much of the rest has been paid out in dividends to support the conspicuous consumption of South African and foreign share-holders.

Yet the dominant explanation for SA’s mass unemployment crisis is that it is the high wages and stringent labour laws that is the cause of unemployment. However, according to the National Planning Commission in 2008 one third of all workers employed in South Africa earned less than R1000 and more than 50% of all workers earned less than R2500 per month. When one takes into account that these averages include the extremely high salary scales of top management in both the private and public sectors it becomes clear that poverty wages is the dominant reality for most working South Africans.
There has also been a dramatic increase in casual and informal employment. It is now estimated that 40% of the labour forces works outside of permanent employment governed by a formal contract. Again this would suggest that the unemployment crisis in South Africa is neither a result of high wages nor stringent labour laws. An alternative analysis of SA’s mass unemployment crisis and high levels of inequality needs to be provided.

Programme Objectives

Popular civil society organisations, especially those campaigning for decent work, a living wage and solutions to unemployment, have utilised AIDC research, analysis and popular education and have increased their capacity for carrying out advocacy and raising public awareness at a local and national level in regard to pro-poor economic policies.