Metals Industry strike - my take

**Justloadit** · 21-Jul-14, 09:57 AM

COSATO and NUMSA are creating so much damage with their unrealistic demands, that it makes me think of an analogy as follows :-

This would be a great cartoon for 'Zapiro'

Imagine there is this wooden ship floating down the river, it is powered by a steam engine, the steam engine is used to power this boat up and down the river. Inside this ship it has paying customers, and in the cargo bay there are goods being transported.

The captain is our president, surrounded by his wives, not caring about what is going ob below deck. The unions are beating the customers, and ransacking the goods, and are manning the steam engine. Since there is no fuel on board, as it was not loaded at the port, the unions are busy stripping the ship from the inside supporting rafters to fuel the steam engine while it chugs along the river.

We all know what is going to happen next, don't we once there is a big hole in the bottom of the hull.

**desA** · 21-Jul-14, 10:28 AM

Add in the wood borers chewing the timber. A swarm of locusts has just set up home. Wasps have begun making nests.

The painters keep painting water onto the timbers to halt the borers, locusts & wasps - as the budget is not there for bug-killer & varnish.

**Dave A** · 21-Jul-14, 07:13 PM

These strikes are incredibly destructive. I heard today that Amplats is intending to sell some of their shafts.

The workers had better hope they don't get bought by the asset strippers that have been the end of quite a few mines already.

**IanF** · 22-Jul-14, 07:08 AM

Here is a blog post from America

UNIONS—-DO THEY PROTECT OR DESTROY JOBS ?

The conclusion is:

This blog is not to be misunderstood as anti-union, but an eye opening comment as to what has happened, and is now happening as you read this little story. This is REALITY. As I did, take a few moments and think back to any and all BIG BUSINESSES that you grew up with, if they are gone (in most cases they are) ask yourself why and draw your own conclusions. While unions are good for workers, they MUST realize where they ultimately will hurt those they represent and act accordingly (this is for the benefit of all). JUST THINK ABOUT IT. For all those that think unions are declining because of the fall of percentages from 20%+ down to 12%, think again. The 12% is based on a much larger population that when their numbers were 20%, plus their dues are much higher. So if anything they are much stronger and that is why they never defend their lower percentage. SMART LIKE A FOX. Can’t we all just get along ?

So the unions are strong in America they have destroyed large industries it looks like we are heading the same way with our mines and other large employers. I see Escom being broken up it smaller parts because of the unions and destructive effect of BEE and AA.

**desA** · 22-Jul-14, 01:05 PM

A fair amount of gimme syndrome appears to be at work. So incredibly destructive.

**IanF** · 22-Jul-14, 01:13 PM

Johannesburg - The main employer body in South Africa's metals and engineering federation has accepted a government proposal to raise wages by as much as 10 percent, it said on Tuesday, raising hopes of an end to a strike by more than 200,000 workers.

The Steel and Engineering Industries Federation of South Africa said unions led by the National Union of Metalworkers of South Africa have until Friday to accept the offer. - Reuters

From IOL website

Lets hope this ends this strike. Nice time to be selling automation equipment for factories.

**tec0** · 22-Jul-14, 10:17 PM

There is a second side to this story, consider how much money was “lost” during the strikes.

I stand to be corrected I think it was a couple of hundred million rand?

Anyhow if they said “OK” here is your money wouldn’t that have been cheaper less damaging and perhaps healthier for our economy?

I mean seriously these people are asking for very little money if you start calculating the overall profits.

Obviously a small business owner cannot afford it but someone with a 700 million+ profit surly can.

Consider that most of these mega corporations have been functioning in this country for more than 20 years. (much more)

How many BILLIONS have they made over the years? I mean if it is not profitable why continue?

Also consider that minimum income in first world countries VS South Africa. If these companies are to let’s say start a mine in Australia then they will have to go by the Australian law of minimum income right?

So will that cost them more money or less money to do? Considering Australia has a healthy economy and there minimum income is MUCH higher than our own...

Truth is our rand is weak and our labour is cheaper than anywhere else in the world.

YES if you earn Rands and pay people in Rands it is difficult. BUT if you get paid in first world money and convert that to our money it is almost nothing. Why because the rand has no real value.

**Justloadit** · 23-Jul-14, 07:56 AM

Originally Posted by tec0

Anyhow if they said “OK” here is your money wouldn’t that have been cheaper less damaging and perhaps healthier for our economy?

So what will then stop them from demanding a 100% increase next time?
After all business makes profit, so rather give it to the employees because the employees made it work, f..k the investors who put the money in the first place to make the mines a viable business, they have no right for return on their money - which means there is no more future investment into anything new cos there is no guarantee on return on investment, cos the workers have the right to your money. Stuff spending money on R & D, stuff spending money on maintenance and replacement of equipment, the employees must get it all.

Anyway the fact that the may be millions of Rands of profit, it must be returned to the investors, and there is not just one investor, there is probably millions of investors in the company, who placed their hard earned money to make the company become profitable and create a return on their money.

What we keep forgetting, is that automation will make 90% of the jobs obsolete, this will create a huge unemployment situation. To prevent this, wages will be lower per preson, simply because of the numbers of employees involved. It is a natural phenomena, the more scarce the resource the higher the value, the more abundant the resource the less value it has. Right now we have an abundance of unskilled workers.

**adrianh** · 23-Jul-14, 08:06 AM

Originally Posted by tec0

There is a second side to this story, consider how much money was “lost” during the strikes.

I stand to be corrected I think it was a couple of hundred million rand?

Anyhow if they said “OK” here is your money wouldn’t that have been cheaper less damaging and perhaps healthier for our economy?

I mean seriously these people are asking for very little money if you start calculating the overall profits.

Obviously a small business owner cannot afford it but someone with a 700 million+ profit surly can.

Consider that most of these mega corporations have been functioning in this country for more than 20 years. (much more)

How many BILLIONS have they made over the years? I mean if it is not profitable why continue?

Also consider that minimum income in first world countries VS South Africa. If these companies are to let’s say start a mine in Australia then they will have to go by the Australian law of minimum income right?

So will that cost them more money or less money to do? Considering Australia has a healthy economy and there minimum income is MUCH higher than our own...

Truth is our rand is weak and our labour is cheaper than anywhere else in the world.

YES if you earn Rands and pay people in Rands it is difficult. BUT if you get paid in first world money and convert that to our money it is almost nothing. Why because the rand has no real value.

What you and the unions fail to understand is that gross profits are merely sales - cost of sales. The profits shown do not include other costs, accrued losses, nor future expenditure. So, lets say I make a loss three years in a row and I now owe the bank R300K. I still need to buy a machine for R100K next year to replace my ailing old machine. Ok, so this year I get lucky and I show a profit of R100K. This means that I bought stuff for R200K and sold it for R300K. But, the profit that I show is NOT cash in the bank for me to spend, I still owe R300K from my accumulated losses, I still need to spend R100K on the new machine and I still need to cover lots of expenses this year. Profit DOES NOT represent the whole financial picture. All that it shows is that you sold for more than it cost you to buy or produce the products that you sold.

Further, everything that you say about big business and big business in South Africa are merely speculation and has no basis in fact. Where are the facts that support your arguments? We all know that many American and Brits can't afford to own homes. That many Americans, Brits, Romanians and and and do not have work.

Let's look at a company like BMW. They need to alter their tooling all the time to be able to manufacture new models - where to you think the money to do this comes from?

tec0 - The problem in this country is that 99.99% of people have no grasp of basic accounting nor economics. No private business is run for the sake of the workers, business is there to make money for the investors. If staff do not want to work or staff constantly strike and cause disruptions then the business will close and move elsewhere. BMW is already not investing any more money in their South African because their international customers do not stand for the continual disruption of supply. Workers in this country think that they can sign a contract and agree to conditions of employment and wage and then strike because they are unhappy about WHAT THEY AGREED TO. Life does not work this way. If people strike in small business then the business closes. Do you realize that 186 businesses closed in Rustenburg because of the strike. That is 186 x how ever many families that are supported by those businesses no longer have an income because one group of people were simply being obtuse.