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S.Africa central bank prods government to act on jobs

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(Globalpost/GlobalPost)

South Africa's central bank governor Gill Marcus pressed the government Wednesday to adopt growth-promoting reforms to stem the country's unemployment crisis.

"It is critical that we focus on growing labour intensive sectors, including mining and agriculture," she said, while warning of a balance between workers rights and growth.

Recent data shows that a quarter of the country's workforce are out of work, with youth unemployment at 50 percent.

The mining sector, which the biggest private sector employer has been threatening to cut jobs, due to strike related losses.

Despite being the largest economy on the continent, South Africa continues to underperform compared to other fast-growing countries in the region, expanding only by 0.9 percent in the first quarter.

Last year the country registered a meagre 2.5 percent growth, hit by the effects of the post 2008 global financial meltdown and the eurozone recession.

Marcus urged the government to introduce measures "to enable low skilled workers to live meaningful lives."

The government has mooted several policies to mitigate unemployment, including a youth wage subsidy.

Marcus said programmes to encourage firms to hire young people have so far not yielded the desired results.

"Our view is that is possible to incentivise firms to hire young people without the threat of displacing more experience workers," she said.

Job creation has been one of the major headaches for the ANC-led government since assuming power at the end of apartheid in 1994.

The outspoken governor also blamed the country's poor education system as one the contributing factors to unemployment.

She said the system "remains below international averages."

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http://www.globalpost.com/dispatch/news/afp/130731/safrica-central-bank-prods-government-act-jobs