Despite R72 billion in profits, mining towns report extreme unemployment and missing development funds.
Mining companies are failing to create jobs for the communities where they operate, recent statistics released by the organisation, Mining Affected Communities United in Action (Macua), indicate.
These show that the unemployment rate in communities situated near the biggest mining operations is more than 65%.
This means mining firms are not fulfilling their role in the Social Labour Plan (SLP) to create jobs for local communities.
Mining firms not fulfilling role in SLP
“Macua is deeply alarmed but not surprised by the latest unemployment data released [last week] by Statistics SA.
“Our research confirms that unemployment in communities located next to some of the wealthiest mining operations consistently exceeds 65%, with some areas having 82% unemployment rate.
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“These figures dwarf the official national average. They expose a central truth that policymakers continue to ignore – that the growth of mining profits is not translating into jobs, justice or dignity for those most impacted by the extraction,” said Macua spokesperson Magnificent Mndebele.
“Government leaders parade Operation Vulindlela and sectoral reforms as solutions to inequality and unemployment. But our audits reveal the opposite.
“The mining sector, empowered by expedited licences, deregulation and policy favouritism, has become a site of elite enrichment, not shared prosperity.
Site of elite enrichment
“With record profits of over R72 billion from just 11 audited mining companies, communities have seen less than 0.13% of that reinvested in their development.
“Our audits uncovered over R284 million in missing SLP funds across 11 sites, with more than 75% of committed development projects incomplete or undocumented.”
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Mining expert David van Wyk said Macua’s report was an accurate reflection of what is happening in the mining-affected communities.
“I fully agree with Macua – mining does not create jobs. This country needs to move up into a post-mining economy.
“On a post-mining economy, I mean that we need not export strategic minerals necessary for manufacturing, for example iron, chrome, manganese, lithium and rare earth minerals. These are all required for manufacturing in general and for batteries and AI technologies in particular.”
Need for focused state and foreign investment
“Then we need focused state and a foreign investment to kickstart a manufacturing base.”
“That means moving away from the low-wage economy. We have 60 million people either on low wages or unemployed. They cannot afford manufactured goods. This is a disincentive for manufacturing.”
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“We could, for example, manufacture batteries and cars [not assemble foreign cars as we are doing currently] but make electric vehicles as these are replacing combustion engines globally.”
Van Wyk said dying mining towns should be repurposed into suppliers of gas and solar energy using old mine electricity substations to feed solar power from mine wastelands into the national grid, and extract methane from old mine shafts.
Large-scale mining in decline
As large-scale mining is in decline, the state should create the conditions for artisanal, smalland medium-scale mining and facilitate community-based industries to add value to the diamonds, gold and platinum extracted, such as by jewellery manufacturing for example, he said.
National Association of Artisanal Miners spokesperson Zethu Hlatshwayo said mines were not equipping people with skills. “So mines employ people from other areas.”
