Dimension of desperation distorts wage negotiations

April 2006 inflation has soared to a back-breaking 1042,9%. The Poverty Datum Line (PDL), for a family of six, reached Z$41 million in April. Assuming, as is generally the case in low income families, that there are at least two income earners in the family (of which one is probably engaged in the informal sector) the principal income earner would need to earn about Z$28 million, but very few workers earn such a wage.
The workers’ circumstances are worsened by many factories having discontinued overtime operations, which had afforded the workers some opportunity of increased earnings, and a great number of factories having scaled-down operations to 3-day weeks, usually because of an inability to obtain imported manufacturing inputs.
In addition, most workers are now not only supporting themselves and their immediate families, but are also giving some financial assistance to numerous others within the admirable Zimbabwean “extended family” culture.
Concurrently, most workers are also subject to ongoing psychological stress brought about by uncertainty of continuance of employment. Many are employed on a “contract” basis, whereby the service can be terminated at any time. Others, although permanently employed, also have no assurance that their employment will be secure, for not only do they witness many enterprises closing down, but they also see their employers’ businesses contracting and struggling for survival in the face of continuously rising costs, declining market demand, scarcity of operational inputs, consequences of unreliable supply of energy, and diverse other factors.
Tens of thousands of workers can no longer afford public transport to travel to and from work. Long before sunrise streams of workers can be seen walking distances from 10 to 20 kilometres, from the high density areas in which they live, to their workplaces. Most do so without even having had a meal, for they can only afford one meal a day, at best. The same scenario occurs as the day ends, with the same, exhausted workers having to walk home, except for the lucky few who manage to obtain a lift from a passing motorist. And they know that when they arrive home, they are likely to be received by an angry and frustrated wife who has had to cope with crying, hungry children, and with demands from schools for payment of overdue fees.
In these circumstances, there is an ever-increasing divide between employers and workers. The workers demand, with rising stridency, that the minimum wage be not less than the PDL (disregarding the fact that there is usually a second income earner in the family), and that all wages rise to at least the same extent as inflation. As a general rule, employers are sympathetic to the plight of their workers, but with rare exception they simply cannot meet the workers’ expectations.
The continuing contraction of the economy is fast shrinking profits of many enterprises, and the ravages of inflation have resulted in the majority of businesses being under-capitalised. This results in having to resort to substantial borrowings, often at rates exceeding 700 % per annum, further eroding profits and limiting ability to fund rising costs, inclusive of wages.
Most workers reject employer claims that the wage levels demanded are unsustainable. On the one hand, the workers are driven by desperation, resulting in an automatic rejection of even the most convincing of employer representations. On the other hand they observe that while they have been reduced to walking to work, and to taking in tenants in their already overcrowded homes, in order to generate a little extra income, the employer still arrives at work in his executive motor vehicle, and still resides in his upmarket home in a low-density suburb.
These worker attitudes are also fuelled by the trade unions, who do so in order to retain and enhance membership, and who receive a portion of any wage increments they have successfully negotiated. Disregarding that the wage demands are pitched at levels that could well cause the failure of many businesses, and, therefore, yet further unemployment, the trade unions are doing themselves and their members a great disservice for the sake of a possible short-term gain.
This tension between workers and employers is not new – but it takes on an added dimension of desperation in Zimbabwe today. Yes, half a loaf is better than none. Yes, just one slice is better than none. Yes, a crumb is better than none. At what stage do both sides agree that the loaf is no longer sliceable? Trade Unions and those firms still in business are on the horns of a very unpleasant dilemma indeed.