While far from a liveable wage, minimum wage earners including farmworkers will now walk away with little more than R4 000 every month. This follows the announcement of a 9.6% increase in the national minimum wage by labour minister Thulas Nxesi.
For years, farmworkers in South Africa have not earned a socially acceptable wage. However, according to the National Minimum Wage Commission, the latest increase should help minimum wage earners maintain a decent standard of living.
The department of employment and labour said farmworkers would earn a minimum in line with the rate of R25.42, as will domestic workers. The increase to the minimum wage came in higher than initially expected.
Meanwhile, agricultural role players argue that already hard-pressed farmers will be put under further strain.
Food security, jobs on the line
Chairperson of Agri SA’s centre for excellence on labour, Johan Wege, said the increase will further undermine food security and put much-needed jobs on the line. This is as the sector battles to contain the costs associated with load shedding, crumbling infrastructure, and high input costs.
“The increase continues a trend of above-inflation increases for more than a decade. Whereas farmers were previously in a position to absorb these increases thanks to the sustained growth in a number of agricultural industries, that period is now over,” Wege said.
According to Wege, the government must appreciate that the sector is faced with extreme headwinds, which on their own threaten food security in the coming years.
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An increase will exacerbate unemployment
Agri SA initially made proposals to the wage commission, calling for a consumer price inflation minus a 2% increase in the national minimum wage.
According to Agri SA, this proposal recognised the financial pressure on workers in this inflationary environment, but also addressed the reality of farmers’ inability to continue to absorb above-inflation increases.
“That government has ignored this balanced position is a devastating blow, not only for the sector but also for the consumers who will eventually see this increase reflected in their food expenditure,” Wege pointed out.
Agri Western Cape has also spoken out against the “steep” increase.
According to the agricultural organisation’s chief executive officer Jannie Strydom, they understand the importance of a liveable wage, however, the economic impact of the new minimum wage on the agricultural sector cannot be ignored.
Profitability and sustainability under threat
“We are extremely shocked and disappointed concerning the [9.6%] increase and the fact that Agri Western Cape’s recommendation to the Minimum Wage Commission had not been considered,” Strydom said.
Agri SA is concerned that the increase will exacerbate unemployment, and believes that the unemployed will suffer the most as potential job opportunities in the agricultural sector have now disappeared like dew in the morning sun.
The additional impact on labour-intensive commodities, as well as other farming operations, also poses an enormous threat to profitability and sustainability, Strydom said.
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