Tag: jobs

Engen refinery set to shut down

By Shirley le Guern for IOL

The Engen oil refinery (Enref) is expected to close its doors in 2023 and the facility may be converted into a fuel storage facility for imported product, according to sources close to the refinery.

Suppliers to the refinery, who did not want to be named, said they had been informed last week that they should plan ahead for its probable shutdown, although Engen’s head office says that no formal decision has been made.

Combined with depressed demand as a result of Covid-19 and persistent low gross refining margins, the outlook for the refining business remains negative and continues to deteriorate, Engen spokesperson, Gavin Smith, said in a statement.

“Despite an excellent track record of operational efficiency, our refinery continues to be negatively impacted by the external global refining environment,” Smith said.

He added that Engen had initiated consultation with employees regarding a multibillion-rand proposal to increase its import and supply capacity in Durban.

“The proposal, which will ensure Engen meets South Africa’s growing demand for petroleum products, remains at a consultative stage with employees during which time alternatives are being evaluated,” it said.

Engen confirmed that it is considering several options with regards to the refinery but no decision has been made.

The refinery employs 650 people and it is unclear how many jobs are in jeopardy should it close.

Smith added Engen would consult stakeholders at the appropriate time should a decision be taken.

Yesterday, KwaZulu-Natal MEC for Economic Development, Tourism and Environmental Affairs Nomusa Dube-Ncube said she had assigned Trade and Investment KZN chief executive Neville Matjie to engage with Engen to look into this matter.

“This forms part of the implementation of the economic transformation and reconstruction plan which is aimed at turning around the situation,” she said.

Commissioned in 1954, the refinery is 66 years old. It has, however, undergone consistent modernisation and routine statutory inspections and maintenance work on its process equipment.

It currently produces Euro 2 spec fuel, according to Smith.

It is South Africa’s third largest oil refinery with a capacity of 135 000 barrels a day.

As South Africa does not have its own oil deposits, liquid fuels are either imported in finished form or as crude oil which is refined at the country’s oil refineries.

Although no official figures are available, the World Bank estimates around 18.63% of South Africa’s liquid fuel was imported in 2018. As demand has continued to outstrip supply from local refineries, this has continued to climb.

According to the South African Petroleum Industry Association, the fuel sector contributes about 8.5% of the country’s gross domestic product.

It said that investment in South Africa’s ageing refineries was necessary to avoid widening the trade deficit for liquid fuels.

Smith said that approximately 60% of Engen products sold in Southern Africa were produced by Enref with the remainder imported or procured from other local oil companies.

“The global refining environment is evolving with the emergence of mega sized, integrated and complex refineries resulting in excess global fuel supply and low refining margins. This is forecasted to persist well into the future.”

Transnet, which operates the R30billion multi-product pipeline that transports four different petroleum products, including refined petrol and diesel, between Durban and Gauteng, said it had not been informed of any proposed changes at Enref.

It added it could not comment on the impact of the refinery’s closure on the port of Durban or on the operation of the single buoy mooring about 2.5km off the coast of Durban, through which both crude oil and refined products are offloaded.

Engen, together with other companies in the fuel sector, is a part owner of this single buoy mooring.

Dube-Ncube said that as part of the province’s implementation of the economic transformation and reconstruction plan, they had adopted a business support, retention and extension programme which focused on:

Supporting businesses that are weak but that have sound foundations and can become viable through accessing existing short-term industrial policy support programmes to contain further job losses and protect important production capabilities.

Supporting existing businesses’ need to expand by creating an environment that is conducive to new investment.

She added it was also focusing on the key interventions that are catered for in the KZN Growth and Development Plan, which are to ensure that they improve access to economic development funding and performance monitoring of the value chain in key sectors.

“Engen remains a key player and a leader of the downstream South African petroleum market. We are proud of the fact that this company is located in this province and on the South Durban Basin, where it contributes towards job creation.

“Our wish is for the company to remain in this province for many more years to come,” she added.

“Importantly, as KZN we potentially have access to the abundant resources of the ocean, including fisheries, offshore oil and gas and maritime tourism.

“Our ports of Durban and Richards Bay handle over 60% of the country’s seaborne cargo. We remain determined to work with companies such as Engen to increase the participation of previously disadvantaged communities in sectors such as oil and gas – maritime industry,” Dube-Ncube added.

She said the department was also determined to position Richards Bay Industrial Development Zone as a site for energy infrastructure.

“The importance of the energy supply sector lies both in improving the quality of life for the previously disadvantaged majority as well as supporting large-scale industrial development.

“In particular, the oil and gas industry presents many opportunities for partnerships in this province. Ahead of lockdown, statistics showed that the oil and gas industry employed an estimated 7500 people and had an estimated annual turnover of over R196billion, with the refining segment of the industry contribution almost 99% to the total industry’s turnover,” said Dube-Ncube.

The industry is believed to account for more than 90000 indirect jobs in the distribution and marketing segment of the industry value chain, she added.

 

SA sheds 2.2-million jobs in the second quarter

By Lameez Omarjee for News24

South Africa shed 2.2-million jobs during the second quarter, according to Statistics South Africa (Stats SA).

While the employment figures reflected the largest decline in employment between the second and first quarter since 2008, Stats SA on Tuesday said unemployment fell substantially as well, decreasing by 2.8 million to 4.3 million. The official employment rate is now 23.3%, compared to the first quarter’s 30.1%.

Peter Attard Montalto, economist at Intellidex said that it is best to rely on the expanded definition of unemployment – which would see the rate between 42.6% and 52.7%, which is more realistic.

The expanded definition includes persons who were not employed when surveyed and were available to work but did not look for work either because they are discouraged from looking for work or did not look for work for other reasons other than discouragement.

Weighing in on the latest statistics, chief economist at the Bureau for Economic Research Hugo Pienaar explained that while the number of employed people declined by 2.2-million, the size of the labour force declined by much more – that is by 5 million. “This is why the unemployment rate came down.”

As to why the labour force declined, Pienaar explained that during the hard lockdown in April, people were not allowed to leave their homes unless they were considered essential workers or to buy food. “You were not allowed to go out and look for a job if you were unemployed at that stage,” he said. Millions less people were actively searching for a job and this resulted in a large decline in the labour force, he said.

“This is temporary. In the third quarter, with the economy opening up again, people can look for work again. The labour force will increase again, I imagine quite dramatically,” he added.

Economists had anticipated record high unemployment, due to poor economic conditions. Nearly a million job losses were projected for the single quarter – this matches the job losses in the 12 months following the global financial crisis, Fin24 previously reported. Investec had forecasted an unemployment rate of 37.9%.

Government had implemented a nationwide lockdown in March in order to slow the spread of Covid-19. During April, only essential goods and services were operational and economic activity was limited with lockdown restrictions at their highest level. As a result GDP contracted by 51%, on a quarter-on-quarter, annualised basis. Non-annualised, the contraction was 16.4%.

In its September quarterly bulletin, released on Tuesday, the Reserve Bank noted that the lockdown had brought about logistical complications for Stats SA – contributing to the delay of the release of the employment data.

“The number of unemployed South Africans had already increased significantly in the year to the first quarter of 2020 due to a surge in the number of new and re-entrants into the labour market who failed to find employment.

“The official unemployment rate increased to a record high of 30.1% in the first quarter of 2020, reflecting the impact of the economic recession that had already started in the third quarter of 2019,” the bulletin read.

Stats SA said that it had to change the mode of collection of data to adapt to Covid-19 safety protocols.

“Given the change in the survey mode of collection and the fact that Q2: 2020 estimates are not based on a full sample, comparisons with previous quarters should be made with caution,” Stats SA said.

In an emailed response to questions from Fin24, Stats SA said data is usually collected from April to June. But due to a change in data collection from face-to-face to Computer Assisted Telephone Interviewing, it was delayed for planning and the training of field workers between April and mid-May. The data was collected from 14 May to 30 June 2020.

Stats SA noted that the usual sample size for the survey is 30 000 but not all sampled dwelling units had contact numbers and the data for this survey was collected from 17 345 dwelling units.

South Africa moved to Level 1 lockdown on 21 September, after President Cyril Ramaphosa announced an easing of restrictions as Covid-19 cases continue to decline.

Among these it was announced that, from 1 October, travel in and out of South Africa will be allowed again under strict conditions.

According to StatsSA, nearly 16.5-million tourists visit South Africa each year. In 2019 alone, this employed 1.5-million people and contributed R425.8-billion to the economy.

Tourism Minister Mmamoloko Kubayi-Ngubane has said that the sector is ready to welcome an increase in activity for both domestic and international tourists.

The restrictions, which have yet to be published, will limit travel to and from certain countries that have high infection rates. This will be updated based on the latest scientific data.

However, South Africa’s move to Level 1 has coincided with the northern hemisphere’s approaching winter – and many countries are seeing a rise in cases, resulting in increased lockdown measures.

According to News24, the 10 leading countries for overseas tourists in South Africa are:

  1. United Kingdom
  2. USA
  3. Germany
  4. France
  5. Netherlands
  6. Australia
  7. China
  8. India
  9. Canada
  10. Italy

The UK Prime Minister, Boris Johnson, just yesterday announced increased lockdown measures, including a return to work-from-home; a 10pm closure time for pubs, bars and restaurants; stricter rules around face coverings in public; and strict fines for lack of compliance.

In mainland Europe, France has reported 10 569 new cases; Italy saw close to 1 000 new infections; and Germany reported 1 345 new cases Sunday, and a further 922 cases Monday. As a result, European countries are likely to impose more restrictions on public life in the coming days.

While Americans are, at this point, allowed to travel, the lack of stringent measures at a federal level has resulted in many countries putting tourists from the States on a blacklist.

Australia’s borders remain closed, although it is slowly opening domestic borders. India is also opening domestic borders, but international borders are not yet open.

China opened its international borders to select countries, which at the moment are Canada, Thailand, Cambodia, Pakistan, Greece, Denmark, Austria and Sweden. This list is expected to change according to the situations in each country.

It has also been noted that domestic tourism is on the rise across the globe as people explore their own backyards, rather than risking quarantine or last minute cancellations. A loss of income due to lockdown and an increase in furlough, retrenchments and unemployment has decreased disposable income – all of which will have a negative impact on tourism.

By Jan Vermeulen for MyBroadband

Amazon announced in June that it was hiring 3 000 new customer service agents in South Africa. The company was looking for skills ranging from basic computer literacy to technical experts.

These new employees are required to work from home and provide support to Amazon customers in North America and Europe.

This means you needed access to a high-speed ADSL or entry-level fibre connection to your home, and to be willing to work shifts the coincide with North American business hours. Some job listings explicitly state a 10Mbps minimum line speed and that LTE connections are not suitable.

According to Amazon, the addition of these 3,000 permanent and seasonal full-time positions will bring the company’s total permanent workforce in South Africa to 7,000.

MyBroadband recently had the opportunity to interview a successful applicant for one of Amazon’s customer service roles, who spoke to us on condition of anonymity. The interview was conducted in person and we were able to verify the authenticity of the claims made.

Impressive, efficient systems
The first thing our jobseeker noted was that every stage during his application and training process was like clockwork.

Amazon communicated what was required at every step and everything was streamlined for efficiency.

After the application through the Amazon jobs website, there was about a week’s wait before the applicant heard that he had made it through the initial screening stages.

Amazon asked whether he was still interested in the position. If he was still interested, he was informed that he needed to complete an aptitude test.

Aptitude testing
This extensive aptitude test is conducted online and took about two hours to complete.

Amazon tested for fluency in English, and reading and listening comprehension.

It then placed the applicant under pressure by having them listen to a scenario where a customer was complaining about something. The recording may be paused at any moment and they were required to answer questions such as “When was this item meant to arrive?”

As he was listening to the customer complaint, Amazon would also pop up perception questions like “Is this customer happy?”

Gruelling training
Another week after the aptitude test, Amazon responded with a job offer. It contained the conditions of employment, salary, and details on company perks like a medical aid, provident fund, and Internet allowance.

Our customer service associate-in-training said that they were given an allowance of R1 200 which had to be put towards their Internet connection.

His total pay package was around R12 000 per month.

The corporate medical aid was provided through Discovery and the provident fund through Momentum.

After accepting the offer, he received a call from an Amazon manager who congratulated him on his appointment.

Two weeks later, he received an email on a Thursday stating that he would receive everything he needed the following day and that his training would begin that Monday. The email also contained instructions on how to set up his equipment.

On Friday morning, a courier arrived with a Lenovo all-in-one computer, an uninterruptible power supply, and a set of hardware security keys. The computer was configured so it could only be used for Amazon.

On Monday morning at 08:00, our trainee was online with a group of 30 other people, a training officer, and his assistant.

They spent eight hours a day in a rigorous and strict training programme.

“Amazon expects a very high level of self-discipline,” he said. “During training, being absent is just not an option.”

If someone was not online at precisely 08:00 in the morning when training was scheduled to start, it was no small issue. The training officer was immediately on the phone to the absent trainee to find out what was going on.

Long hours, strict self-discipline
Trainees were told that after they completed the programme, their working schedules would be quite rigid.

To serve the North American market, your shift in South Africa would begin between 16:00 and 19:00 in the evening and run for eleven hours until the following morning.

This includes an unpaid lunch hour and two paid 15-minute tea breaks.

When you step away from your workstation to take a break, you must set your status as being on a break. If you couldn’t take your break at the scheduled time because you were finishing up a call, you must note that in the system.

Trainees were also informed that they should prepare for the fact that during the first six months of work they will not be able to swap shifts with other customer service associates.

Performance monitoring
Once you graduate from training and you begin working, Amazon monitors your performance.

However, this is not a fixed number applied to all customer support agents. Amazon makes provision for new recruits to go through a period of improving as they become more familiar with the job.

“Everything is measurable,” the interviewee said. “You set a baseline performance level in that first week.”

As long as you are always improving, Amazon is happy. The company also works hard to try and retain staff, he said.

Exit procedure
The person we interviewed did not end up becoming an Amazon staff member. They bowed out during training for personal reasons, and because they felt they would not be able to multitask at the pace needed to excel at the job.

He explained that during training, he learned that they would be required to look up information related to a customer’s query in the Amazon knowledge base for support agents while on a call, and then proceed based on the guidelines provided.

“It’s extreme multitasking,” he said.

When he informed Amazon that he did not wish to continue, there was genuine concern. They wanted to know if they had done something wrong and whether they could be clearer in explaining what the job entailed so applicants would know exactly what to expect.

He was also caught off-guard when Amazon said they would pay him for the time he spent in training.

“It was truly impressive,” he said. “It would be great if South African companies could operate at this level of efficiency.”

Source: Supermarket & Retailer 

More than 1 400 staff members at Pick n Pay have taken voluntary severance packages since March, the retailer has said in a trading update.

The Cape Town-based group’s voluntary severance programme (VSP) offers staff 1.5 weeks of pay per completed year of service, plus four weeks of notice pay.

According to the group, its objective is to reduce employee costs.

The group said the cost of the compensation payments to departing employees will be borne in the first half of the current financial year.

Pick n Pay said it expects the programme to be cost neutral for the full financial year, as compensation packages will be fully recouped through cost savings.

“In subsequent years, the reduction in employee numbers will have a positive impact on the operating costs of the group. Alongside other strategic actions designed to improve the Group’s performance, the VSP is a major step forward in making the business more competitive and more sustainable” the update read.

The group is projecting that its headline earnings per share for the 26 weeks to end August 2020 will be down by more than 50% as it grapples with the effects of Covid-19 on its business. This excludes the impact from hyperinflation accounting in Zimbabwe.

“I want shareholders to understand and be reassured that the impact on our first-half earnings that we are announcing today derives solely from the specific circumstances of the pandemic, the impact of measures taken by government and ourselves to mitigate it, and the once-off costs of our VSP which has made the Group leaner and more competitive,”said Richard Brasher, CEO of Pick n Pay, in the statement.

Source: News24

Retailer Massmart says it has started a consultation process under Section 189 of the Labour Relations Act that may affect 1 800 employees at Game stores in South Africa.

In a short update to shareholders on Tuesday, Massmart said the decision came after it “recently completed an assessment of opportunities to improve our South African Game store efficiencies”.

Section 189 of the act governs, among other things, the procedures that companies must be take ahead of any possible retrenchments.

In addition to Game, Massmart owns Makro, Dion Wired, Builders Warehouse and Masscash.

Unemployment in South Africa rose to 30.1% in the first quarter of 2020, according to Stats SA.

Since the beginning of the year, SA’s tech sector has seen a jobs bloodbath.

  • In January, telecommunications giant Telkom communicated it was retrenching as many as 3 000 employees
  • Retail giant Massmart closed down its electronics units – DionWired and Masscash – leaving 1 400 people without jobs
  • Systems integrator Dimension Data revealed that approximately 480 employees were to leave the business through a Section 189 process
  • Cell C announced it was to let go of as much as 40% of its semi-skilled labour force, as well as some senior managers and executives
  • SABC is also set to cut about 600 jobs

During the period, finance shed the most jobs (50 000), followed by community and social services (33 000), agriculture (21 000), transport (17 000), manufacturing (15 000), construction (7 000) and utilities (4 000).

Jobs bloodbath at SABC

According to Sunday World, The SABC has revived plans to retrench workers – despite the uproar that flared up when the public broadcaster initially wanted to cut hundreds of jobs as part of a turnaround process.

  • It will reduce the cash-strapped organisation’s salary bill by R700-million
  • It plans to invoke section 189 of the Labour Relations Act to cut 33% of staff
  • This means retrenchment of 981 permanent staff members and more than 1 200 freelancers
  • The current SABC operating model is not defined and had major challenges, such as the absence of an overarching group strategy and planning function cascading to divisional plans

Ellies announces job cuts

Source: MyBroadband

South African companies have announced plans to cut more than 10 000 jobs less than three months into 2020 as faltering economic growth adds strain in a country where a third of the workforce is unemployed.

Electronics company Ellies Holdings Ltd. is the latest to start the process of reducing its headcount due to ongoing financial losses.

Jobs are also at risk at companies including Telkom SA SOC Ltd., the country’s largest fixed-line operator, and Walmart Inc.’s local unit, Massmart Holdings Ltd., after slumps in earnings.

If realised, these job losses will add to an unemployment rate that is at the highest in at least 11 years, and place a further dampener on an economy stuck in the longest downward cycle since World War II.

Annualised gross domestic product data to be released Tuesday will probably show South Africa fell into a second recession in consecutive years after state power utility Eskom Holdings SOC Ltd. implemented the deepest electricity cuts yet in December. The economy likely contracted by 0.2% in the final three months of 2019, according to the median estimate of economists in a Bloomberg survey.

That may have dragged down economic growth for the full year to the slowest in a decade.

Over 9 000 jobs to be cut in SA

The first two months of the new year have seen a number of South African companies give notice to retrench workers – a move which will result in more than 9 000 people losing their jobs.

Below are some of the companies who are looking to downsize their workforce:

Telkom

  • Telkom informed trade unions and staff that it could cut up to 3 000 of its more than 15 000 employees
  • The company is struggling with declining performance in the face of competition
  • The Federation of Unions of South Africa (FEDUSA) has highlighted that overall job cuts at Telkom in 2020 could be around 6 000 jobs

Samancor 

  • Mining company Samancor Chrome said it could cut close to 2 500 jobs in response to weak chrome prices and power supply problems
  • The job cuts would apply to its Eastern and Western Chrome mines
  • It cited Eskom’s power supply problems and increased electricity tariffs as reasons for the jobs cut

Dion Wired/Massmart 

  • Massmart plans to shutter the 23-store Dion-Wired chain of hi-tech appliance shops and 11 Masscash wholesale outlets
  • This will affect 1 440 employees of 12 000
  • Massmart is suffering from an earnings slump due to declining consumer traffic in malls and low consumer confidence, which has affected sales of high price-ticket electronic items

Sibanye-Stillwater

  • The mine has reportedly retrenched 1 142 employees, well below the initial anticipated retrenchment figure of 5 270 jobs
  • The mining company employs 88 000 people across South Africa
  • The retrenchments follow the Section 189 restructuring at its Marikana operation, which has suffered losses since the shooting in 2012

Glencore

  • Glencore issued section 189 notices to 665 employees
  • The retrenchments centre around the mine’s Rustenburg Smelter
  • The group has cited the high cost of electricity and an increase in the carbon tax and logistics costs as reasons for downsizing

Aspen

  • Aspen Pharmacare said it plans to cut up to 219 jobs at its Port Elizabeth and East London plants
  • The drugmaker is disposing of non-core assets to manage its debt burden as it seeks to remain globally competitive
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