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Even as gold prices rise, miners struggle

South Africa's miners face dangers even after post-apartheid reforms.

At work in the Modderfontein east mine, outside Johannesburg, Feb. 3, 2009. (Siphiwe Sibeko/Reuters)

BOKSBURG, South Africa — Phillip Ntandazo Madyosi, 47, has little to show for his three decades of backbreaking work in South Africa’s mines. The few skills he learned underground are of no value above the surface. Now, the small severance package he received after his recent layoff is vanishing quickly.

“That money, we use it for buying food, for transporting children to school,” he said. “We sit in the problem here. It’s not a problem. It’s a crisis. It’s a disaster.”

Even though international gold prices are high — above $900 per ounce, with some analysts predicting the price could hit $1,000 — many of South Africa's mining corporations are facing declining profits. They face higher costs in wages and safety precautions, plus many South African mines are more than 100 years old and miners must dig deeper for the gold.

Recently Anglogold Ashanti's Mponeng mine became the world's deepest at 2.3 miles below the surface. There is gold at the deeper depths, but mining firms must pay more to extract it, including increased safety measures.

South Africa’s mining industry — the main pillar of the country’s economy — was built on the cheap labor provided by generations of black workers who toiled in perilous conditions. Mining is South Africa's largest employer with 460,000 workers. More than 70 percent of those miners are black, according to government statistics. Since the end of apartheid in 1994, working conditions have improved, stronger safety regulations have been put in place, and unions have won higher wages and better benefits.

Still, every year an average of 200 miners die and an additional 5,000 sustain serious injuries, according to the unions. Unknown numbers of miners contract illnesses such as silicosis and tuberculosis, and HIV/AIDS is rampant in the hostels where many workers live. Earning an average salary of $350 a month, miners struggle to feed the eight to 11 family members who, on average, depend on them for survival. And if they lose their jobs, they are often unprepared to compete for jobs outside the mines.

For more than a century South Africa had ruled supreme as the world's largest gold producer, but no longer. South Africa's gold output fell 14 percent to 232 tons in 2008, due to power outages and labor strikes, dropping it to third place, behind China and the United States. 

South Africa's miners insist that their industry must continue to improve safety conditions and wages.

“We really are proud of our achievements,” said Lesiba Seshoka, spokesman for the National Union of Mine Workers, the country’s largest miners' union with 280,000 registered members. “But we believe that there is still a long way to go to improve the cause of mine workers.”

Seshoka said that during the 1980s and 1990s, 700 workers died every year in South Africa’s mines. Since the introduction of stringent regulations in the Mine Health and Safety Act in 1996, accidents have been systematically investigated, and fatalities have gradually decreased. Last year, 168 miners lost their lives, compared to 220 in 2007.