http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.72Change: 0.03
R/$ = 11.03Change: -0.07
Au 1198.33 $/ozChange: -0.83
Pt 1204.50 $/ozChange: -25.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Contact Us
 
 
 
Article   Comments   Other News   Research   Magazine  
 
 
Sep 28, 2012

Obvious questions, no obvious answers

Back
Africa|Education|Africa|South Africa
Africa|Education|Africa|
africa-company|education-company|africa|south-africa
© Reuse this



In the post-Marikana era, new questions are being asked about inequality, with a particular spotlight being thrown on to the issue of executive remuneration and the size of the gap between the highest and lowest paid employees within a company.

It’s not a new theme and it is most definitely not an uncom-plicated theme. But there is a definite sense of unease, even revulsion, about current executive-pay levels and the method-ologies used to inform these packages. There is particular anger that most bonus schemes seem to be entirely immune to poor performance.

Without doubt, this is not a uniquely South African dilemma. Serious questions are being asked globally about the impact inequality is having on economic performance and on social cohesion.

For instance, the ‘Trade and Development Report, 2012’, which was published by the United Nations Conference on Trade and Development (Unctad) earlier this month, dedicates a great deal of attention to the issue of inequality, its impact on growth and possible remedies.

The analysis shows that, over the past 30 years, income inequality has increased within countries and that in several instances, the richest one per cent of the population now accounts for 10% to 20% of national wealth.

One of Unctad’s key messages is that “there is nothing natural about rising inequality that requires society to allow or accept it, nor does it improve the efficiency of market outcomes”.

In fact, the authors assert that the current weak global economic performance has its roots in faltering demand, which, in turn, can be attributed to issues such as wage compression, deleveraging and unemployment.

There will be no significant recovery, Unctad avers, until low- and middle-income groups achieve sufficient earnings to spend on consumption, which will create the demand required to drive modern economies.

In other words, it argues that dealing with inequality through more even income distribution will be critical to future economic performance.

This argument is premised on a view that high inequality deprives people of access to education and credit, and prevents the expansion of domestic markets. “Thus, a better income distribution pattern would help stimulate and sustain economic growth in the short run and would provide stronger incentives for investment, innovation and job creation in the long run.”

Given the extreme nature of South Africa’s wealth–poverty divide, it is only natural that this issue should receive greater attention and should be a top-of-mind priority for government, business and labour.

But there is also a need to grapple with issues of remuneration and inequality within the highly contradictory context of skills shortages amid chronic unemployment. In other words, we should not expect the answers to be easy to come by, nor that the remedies will be straight- forward to formulate and implement.

Edited by: Terence Creamer
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Editorial Insight News
Article contains comments
Given the prevailing uncertainty about Eskom's ability to keep the lights, it came as something of a relief to hear that the bidding process for the long awaited ‘baseload coal’ independent power producer (IPP) procurement programme is set to begin shortly and that...
South Africa has been ranked third, after China and Brazil, in a new country-by-country assessment of 55 renewable-energy markets in Africa, Asia, Latin America and the Caribbean. The Climatescope 2014 report and index, which has been compiled by Bloomberg New Energy...
There may be no consensus on the size of Africa’s middle class, but there is, nevertheless, broad-based agreement on two things: firstly, that the African middle class is growing and, secondly, that its rise is important to the continent’s future prospects. A new...
More
 
 
Latest News
Updated 7 hours ago Increased maintenance costs, poor rolling mill yields and strike action have widened Evraz Highveld Steel’s operating loss, from R149-million in the nine months ended September 30, 2013, to R483-million for the comparative 2014 period. The company added on Monday...
Updated 7 hours ago Energy Minister Tina Joemat-Pettersson has misled Parliament and should be suspended pending an investigation, the DA said on Monday. "Reports indicate that the minister was involved in recommending and appointing Mr Tshepo Kgadima as chairman of the board of...
More
 
 
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
 
 
 
 
 
This Week's Magazine
JSE-listed real estate investment trust (REIT) Rebosis Property Fund achieved a distribution growth of 8.1% to 99.45c per linked unit in the financial year ended August 31, despite volatile market conditions.
JAMES ROBERTS The MOM incubator was designed to help babies in developing nations who were dying in conflict-struck nations or who do not receive hospital care
A low-cost, inflatable incubator won this year’s international James Dyson design award, which aims to encourage and inspire the next generation of design engineers.
The World Bank released its ‘Doing Business 2015: Going Beyond Efficiency’ report last month and ranked South Africa 43 out of 189 global economies for its ease of doing business, with Singapore topping the rankings.
Air Products South Africa officially launched its R300-million Eastern Cape air- separation unit (ASU), at its new manufacturing facility in the Coega Industrial Development Zone (IDZ), earlier this month. It is the second facility that Air Products launched in South...
BMW South Africa (SA) has signed a power purchasing agreement with energy company Bio2Watt. The offtake partnership will bring renewable energy to the carmaker’s Rosslyn plant, north of Pretoria.
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks