by Chris Yelland, EE Publishers
On Thursday 29 October, well over a week ago, a fateful Eskom board meeting heralded an unprecedented management crisis within this key South African state-owned enterprise.
The company is still reeling from a generation capacity crisis, the power black-outs of 2008, a serious skills shortage, a funding crisis for its new-build programme, and applications to the Regulator that would increase the price of electricity five-fold over the five-year period from 2008 to 2012.
Of course it is no coincidence that the new crisis has occurred at this critical juncture. In fact, this latest management crisis is simply a manifestation of the convergence of pressures and tensions arising from these and manyother issues at this time… (more)
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Tuesday 10 November 2009 at 12:19
Philip Machanick
There was I thinking Eskom was slowing down its output as SA’s contribution to combating climate change 🙂
Did anyone notice “parastatal” has the same root as “paralysis”?
Monday 9 November 2009 at 12:13
alton Browski
When you use the phrase “labor shortage” or “skills shortage” you’re speaking in a sentence fragment. What you actually mean to say is: “There is a labor shortage at the salary level I’m willing to pay.” That statement is the correct phrase; the complete sentence and the intellectually honest statement.
Employers speak about shortages as though they represent some absolute, readily identifiable lack of desirable services. Price is rarely accorded its proper importance in their discussion.
If you start raising wages and improving working conditions, and continue doing so, you’ll solve your shortage and will have people lining up around the block to work for you even if you need to have huge piles of steaming manure hand-scooped on a blazing summer afternoon.
Re: Shortage caused by employees retiring out of the workforce: With the majority of retirement accounts down about 50% or more, most people entering retirement age are working well into their sunset years. So, you won’t be getting a worker shortage anytime soon due to retirees exiting the workforce.
Okay, fine. Some specialized jobs require training and/or certification, again, the solution is higher wages and improved benefits. People will self-fund their re-education so that they can enter the industry in a work-ready state. The attractive wages, working conditions and career prospects of technology during the 1980’s and 1990’s was a prime example of people’s willingness to self-fund their own career re-education.
There is never enough of any good or service to satisfy all wants or desires. A buyer, or employer, must give up something to get something. They must pay the market price and forego whatever else he could have for the same price. The forces of supply and demand determine these prices — and the price of a skilled workman is no exception. The buyer can take it or leave it. However, those who choose to leave it (because of lack of funds or personal preference) must not cry shortage. The good is available at the market price. All goods and services are scarce, but scarcity and shortages are by no means synonymous. Scarcity is a regrettable and unavoidable fact.
Shortages are purely a function of price. The only way in which a shortage has existed, or ever will exist, is in cases where the “going price” has been held below the market-clearing price.
Monday 9 November 2009 at 12:04
Gerhard
Chris, what really bothers me is that the “loose canon…populist etc etc” people who stall and hijack this process may actually understand the seriousness of the whole debacle and yet still go ahead and do what they do.
Monday 9 November 2009 at 10:31
Dave Tootill
Is there a hedge fund which is short selling South Africa Inc? Would be a good investment.