I recently got my notice from the National Bargaining Council for the Electrical Industry infrming me that pay increases for my staff will be 8% this year. I believe the contract cleaners are on a 8% increase too. Then there's the truckers... 9.5% if memory serves.
My thought was this - if the official government inflation target range is 3-6%, GDP grows at about 4% and government facilitated pay increases pretty much start at 8%, sooner or later we aren't going to be able to pay the bills, let alone all these jobs this economy is supposed to create one way or another.
Seems I'm not the only one who can see a problem in the maths. Mike Schussler is saying the maths doesn't add up too, although the ANC doesn't seem interested in taking it seriously.
Obviously these MPs are aware of some law of economics that Mike hasn't learnt yet. Last I checked money doesn't grow on trees.Cape Town - For the second time in as many months ANC parliamentarians have pooh-poohed serious warnings about the country’s current economic direction.
On Tuesday ANC MPs remonstrated with one of South Africa’s top economists for his “exaggerated” figures on job creation, social grants and the future “wealthy” public service.
The economist, Mike Schussler of Economists.co.za, made these assertions in a submission on the national budget to a joint sitting of the parliamentary finance committees.
He sketched a sombre picture of the economy’s ability to meet government’s ambitious job-creation targets and warned about high wage increases in the public service and the little protection afforded small and medium-sized (SME) enterprises.
But these warnings were scorned by the ANC.
Last year ANC MPs also angrily repudiated warnings by the International Monetary Fund (IMF) that reform was needed in the country’s wage-negotiation structures if the country was to achieve 6% or 7% growth (to create jobs) in the short term.
So any chance these wise MPs could let the rest of us in on their economic miracle secret?