South African miners seek 60% pay rise

JOHANNESBURG – South Africa’s National Union of Mineworkers (NUM) said it would seek pay rises of up to 60 per cent from gold and coal producers, raising the prospect of fresh strikes as firms battle higher costs and falling prices in an already heated labor climate.Africa’s biggest economy is hoping to avoid the 2012 wildcat strike action at platinum and gold mines that cost billions in lost revenue and production and killed over 50 people.Mineworkers are mobilising to assert themselves, with the NUM fighting a challenge to its once near monopoly in the shafts from the Association of Mineworkers and Construction Union (AMCU), which has poached tens of thousands of platinum miners from it in a violent struggle for members.NUM said it was seeking an entry-level minimum monthly wage of 7,000 rand ($750) for gold and coal surface workers and 8,000 rand for those underground in a submission to the country’s Chamber of Mines.Elize Strydom, the industrial relations adviser at the Chamber of Mines, said the minimum wage for surface workers is currently 4,700 rand and for underground miners it is 5,000 rand, so the demands for the latter are 60 per cent.NUM also said it wanted 15 per cent increases for “all other wage categories”, or more experienced and skilled workers.Sliding precious metals prices have raised the pressure on miners as they ready for pay talks. Spot platinum on Friday closed at $1,450 an ounce, down around 35 per cent from a record high of $2,240 hit in March 2008. Most South African shafts are losing money at this price. Gold has declined by 19 per cent this year on concern the US central bank will end its extensive stimulus for the US economy.Mining companies have been awarding above-inflation wage rises over the past decade but with labour now accounting for over half their costs in South Africa, they are reaching a point where this is no longer sustainable for their income statements, especially as power and other costs climb steeply.But even increases above inflation do not go far for workers at the bottom end of the pay scale.South African inflation is currently running at under 6 per cent and looks set to accelerate given recent weakness in the rand currency. Rising inflation, especially for food ,will harden the resolve of workers.

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South African miners seek 60% pay rise