Unions ‘key factor in helping slash poverty’

DESPITE a growing gross domestic product (GDP) coupled with an inflation rate as low as 2,3 per cent last year, Namibia’s steadily accumulating wealth is still not being shared with the majority of its citizens almost 17 years after Independence.

But according to a study revealed by the Labour Resource and Research Institute (LaRRI) in Windhoek on Monday, trade unions, a key factor in helping this come to fruition, are starting to make strides. The study states that trade unions managed to raise average wages for its members by seven per cent across all sectors in 2005, compared to a 6,8 per cent increase in 2004.This means that on average, the lowest paid workers in the country now receive N$1 583 per month, an N$111 improvement over 2004’s average of N$1 472.The study showed that the majority of Namibian workers continue to be categorised as either unskilled or semi-skilled workers, and usually earn less than N$1 000 a month with no added benefits.By raising the minimum wages this majority can obtain, LaRRI argues that poverty can eventually be alleviated in Namibia.”With the exception of those sectors where strong trade unions managed to negotiate reasonable working conditions, these workers usually earn far below a living wage and enjoy very few benefits.On the other hand, managers and other professionals earn packages of N$250 000 to N$400 000 or more a year.”These enormous differences in payment have created a three-tier labour market: a small elite enjoying a standard of living comparable to first-world countries, a significant group of formal-sector workers with permanent jobs and low to middle incomes, and a growing group of casual, informal and unemployed workers who are forced to accept any job under any conditions,” the report states.”Since about half of Namibian households (48 per cent) relied on wages and salaries as their main source of income, raising minimum wages can lead to the reduction of the huge gap between rich and poor and contribute to the alleviation of poverty in Namibia,” it continues.The transport sector gained the most in 2005 from union negotiations with their employer, receiving an average increase of 12,6 per cent.Wholesale and retail followed at a 9,1 per cent increase.LaRRI researcher Cons Karamata said that wholesale and retail workers benefited from a boom in those industries, which was largely thanks to the low inflation environment.Workers in the agricultural sector showed the least improvement, with the wages only increasing by 4,6 per cent.This despite the fact that agriculture “was a major contributor to the country’s economic growth due to the good rains received in 2005”.Karamata said it was noticed that in 2005, especially the Namibian Food and Allied Workers gained from studying and collecting statistics on industries and companies before engaging in negotiations.Nafau managed to negotiate an average increase of 8,5 per cent for its members, compared to the previous year’s 4,4 per cent increase.The Namibia Transport and Allied Workers Union was the most successful union in 2005, attaining a 10 per cent average increase.In contrast, the Namibia Farm Workers Union was least successful, only managing to raise annual wages for its members by 4,4 per cent.Namibia remains the country with the most unequal distribution of wealth in the world, as ranked by the Gini coefficient.The Gini coefficient is ranked on a scale between 0 and 1 – with 0 representing perfect equality and 1 representing perfect inequality.Namibia has a Gini ranking of 0,71, compared to Botswana’s 0,63, Brazil’s 0,59 and South Africa’s 0,57.The study states that trade unions managed to raise average wages for its members by seven per cent across all sectors in 2005, compared to a 6,8 per cent increase in 2004.This means that on average, the lowest paid workers in the country now receive N$1 583 per month, an N$111 improvement over 2004’s average of N$1 472.The study showed that the majority of Namibian workers continue to be categorised as either unskilled or semi-skilled workers, and usually earn less than N$1 000 a month with no added benefits.By raising the minimum wages this majority can obtain, LaRRI argues that poverty can eventually be alleviated in Namibia.”With the exception of those sectors where strong trade unions managed to negotiate reasonable working conditions, these workers usually earn far below a living wage and enjoy very few benefits.On the other hand, managers and other professionals earn packages of N$250 000 to N$400 000 or more a year. “These enormous differences in payment have created a three-tier labour market: a small elite enjoying a standard of living comparable to first-world countries, a significant group of formal-sector workers with permanent jobs and low to middle incomes, and a growing group of casual, informal and unemployed workers who are forced to accept any job under any conditions,” the report states.”Since about half of Namibian households (48 per cent) relied on wages and salaries as their main source of income, raising minimum wages can lead to the reduction of the huge gap between rich and poor and contribute to the alleviation of poverty in Namibia,” it continues.The transport sector gained the most in 2005 from union negotiations with their employer, receiving an average increase of 12,6 per cent.Wholesale and retail followed at a 9,1 per cent increase.LaRRI researcher Cons Karamata said that wholesale and retail workers benefited from a boom in those industries, which was largely thanks to the low inflation environment.Workers in the agricultural sector showed the least improvement, with the wages only increasing by 4,6 per cent.This despite the fact that agriculture “was a major contributor to the country’s economic growth due to the good rains received in 2005”.Karamata said it was noticed that in 2005, especially the Namibian Food and Allied Workers gained from studying and collecting statistics on industries and companies before engaging in negotiations.Nafau managed to negotiate an average increase of 8,5 per cent for its members, compared to the previous year’s 4,4 per cent increase.The Namibia Transport and Allied Workers Union was the most successful union in 2005, attaining a 10 per cent average increase.In contrast, the Namibia Farm Workers Union was least successful, only managing to raise annual wages for its members by 4,4 per cent.Namibia remains the country with the most unequal distribution of wealth in the world, as ranked by the Gini coefficient.The Gini coefficient is ranked on a scale between 0 and 1 – with 0 representing perfect equality and 1 representing perfect inequality.Namibia has a Gini ranking of 0,71, compared to Botswana’s 0,63, Brazil’s 0,59 and South Africa’s 0,57.