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Impact of the Sectoral Determination for Farm Workers on the South African Sugar Industry: Case Study of the KwaZulu-Natal North and South Coasts

  • Murray, Justin
  • van Walbeek, Corne

A survey of 103 sugarcane farmers on the KwaZulu-Natal coast was conducted in order to analyse the impact of the Sectoral Determination for Farm Workers (2002) on South African agriculture. The sample was separated into a high wage paying North Coast and lower wage paying South Coast. Typically farmers were unable to distinguish between the impact of the Sectoral Determination and other labour laws. Results indicate that the impact of the legislation is similar in each region. No respondents reported mass retrenchment, but job shedding is disguised by not replacing workers (especially unskilled workers) that leave the farm. A sizeable number of growers (17 per cent on the South Coast and 44 per cent on the North Coast) have reduced the working week to 27 hours (or 36 hours in the Felixton Mill Group Area) enabling them to pay wages on an hourly, rather than a weekly basis. This strategy reduces the effective wage. About 40 per cent of growers have reduced the in-kind benefits to their workers. About half of respondents indicated that they are likely to increase their use of seasonal and contract labour in future. Although a majority of respondents indicated that they considered mechanisation of the harvesting process, cost and topographical factors currently does not make this a serious alternative to manual harvesting. However, because of increased wage costs and the relatively strong currency in recent years, chemical weed control has become an attractive alternative to manual weed control.

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Article provided by Agricultural Economics Association of South Africa (AEASA) in its journal Agrekon.

Volume (Year): 46 (2007)
Issue (Month): 1 (March)
Pages:

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Handle: RePEc:ags:agreko:10131
Contact details of provider: Web page: http://www.aeasa.org.za/
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  1. E.J. Goedecke & G.F. Ortmann, 1993. "Transaction Costs and Labour Contracting in the South African Forestry Industry," South African Journal of Economics, Economic Society of South Africa, vol. 61(1), pages 44-54, 03.
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  3. Conradie, Beatrice, 2005. "Wages and wage elasticities for wine and table grapes in South Africa," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 44(1), March.
  4. Dickens, Richard & Machin, Stephen & Manning, Alan, 1999. "The Effects of Minimum Wages on Employment: Theory and Evidence from Britain," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 1-22, January.
  5. Cubitt, Robin P & Heap, Shaun P Hargreaves, 1999. "Minimum Wage Legislation, Investment and Human Capital," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(2), pages 135-57, May.
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