Unemployment escalates as companies close

The continuing closure of companies and whole industries in the eastern border town has triggered an alarming rate of unemployment in the province, says vice-president of the Confederation of Zimbabwe Industries Henry Nemaire.

Henry Nemaire of the Confederation of Zimbabwe Industries.
Henry Nemaire of the Confederation of Zimbabwe Industries.

Nemaire’s remarks come at a time when unemployment levels in the country continue to skyrocket, with around 80 per cent of employable Zimbabweans out of work.

Manicaland has experienced mass industry closures and redundancies as manufacturing firms either folded or laid off their workforces during the hyperinflation era and even after 2009 when the coalition government was formed.

Karina Textiles, Cairns Foods, Pine Products, PG Safety Glass and Mutare Board and Paper Mills, which used to be the country’s only manufacturer of newsprint, have all closed.

Those that remain are struggling to remain afloat. These include Quest Motors and Tanganda Tea Company, which are operating way below capacity. More than 10,000 jobs were lost directly and indirectly following the closure and redundancies of these strategic companies, according to official figures.

The Zimbabwe National Chamber of Commerce statistics reveal that MBPM, a division of Art Corporation, used to employ more than 1,000 workers.

When Cairns closed its operations at its Mutare fruit and vegetable factory, 91 workers were left jobless. It is also understood that almost 4,550 farmers used to supply produce to Cairns, earning at least $1.8m a year.

Statistics further reveal that Tanganda, which used to be a high-performing company, is operating with a staff of 3,749 – a far cry from the full complement of 7,725.

PG Glass, a subsidiary of Zimbabwe Plate Glass industries, put 133 workers, including 18 managers, on compulsory leave when it ceased operations in December 2010.

Also, due to reduced capacity utilisation, which is now at 10 per cent, Kenrose Filters is operating at just 10 per cent of capacity and has just 30 per cent of its usual 400-strong workforce.

Karina also rendered 600 workers jobless when it closed shop, while Mutare Bottling is employing a mere 323 workers and operating at 35 per cent capacity. Quest Motors is operating below 10 per cent with fewer than 100 workers.

Company closures and downsizing have become a national crisis.

At a press conference last week, Paurina Mpariwa, the MDC-T labour, employment and social security minister, said her party was concerned by the number of companies shutting down and workers being laid off.

“More than 300 companies have been liquidated in recent months while 149 companies have filed for liquidation at the High Court. More than 300 workers are being retrenched on a weekly basis,” she said.

Mpariwa said this flew in the face of the Zanu (PF) election manifesto, which promised to create more than 2m jobs in the next five years yet. Six months later, she said, “not a single job has been created”.

Companies such as David Whitehead Textiles, Blue Ribbon Industries, Merspin, National Blankets and Modzone and Karina Textiles are under judicial management.

Other companies that are struggling include Kalahari Clothing, Lancashire Clothing Company, Polyfoil Zim, Walters Bakery, Impala Enterprises and Lasker Brothers.

“The most affected people are the workers who are not certain whether these companies will reopen in 2014,” Mpariwa said.

Some of the biggest employers in the country have also laid off workers and these include Zimplats, Unki, Bindura Nickel, Mimosa, Spar Supermarkets, Dairibord, Cairns Foods and Olivine Industries.

The banking sector has not been spared by the country’s rapid economic slowdown since the July 2013 elections, with seven banks being placed under surveillance by the Central Bank.

Mpariwa said this was “only a tip of the iceberg of what is happening across the country where thousands of workers are being laid off”.

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