The government must intervene to prevent the collapse of local enterprises that provide much-needed jobs as this destroys the dependents of retrenched employees, said National African Federated Chamber of Commerce (Nafcoc) president Gilbert Mosena.
Mosena was reacting to the news that more than 600 workers of Assmang Manganese in Cato Ridge outside Pietermaritzburg would be left unemployed as the company was in the process of shutting down.
The company, which processes manganese and is a joint venture between Assore, whose chairperson is billionaire Desmond Sacco, and billionaire business magnate Patrice Motsepe’s African Rainbow Minerals (ARM), was formed in 1935.
The workers, most of whom live in Cato Ridge and KwaXimba in the outer west region of eThekwini, have been served with retrenchment letters.
Assmang senior communication and branding manager, Betty Maloka, said the company had been facing an unsustainable increase of operational costs of up to 930% since 2008, which became uncontrollable.
“A closure of the plant would potentially affect approximately 310 permanent and 290 contract workers,” said Maloka.
She explained that Section 189 of the Labour Relations Act, which governs the retrenchment consultation process, monitored by the Commission for Conciliation, Mediation and Arbitration (CCMA), was under way.
“Assmang is committed to ongoing engagement with affected employees and community leaders and is working closely with relevant stakeholders and authorities to explore ways to minimise the social and economic impact of potential closure.
“Despite extensive efforts to sustain operations, the plant has been unable to overcome the mounting financial losses caused by depressed global manganese alloy prices and rising production costs,” said Maloka.
Speaking to this reporter on the sideline of the 60th anniversary of Nafcoc in Durban on Friday night, Mosena described the pain of losing jobs by pointing out issues that could be resolved if the government intervened sooner rather than later.
“You can imagine if a person is losing a job, it affects not only him but a number of people as we are living with a very extended family system.
“The immediate family members become the victims of that situation, and because of our extended family system, other members of the extended family also get affected,” he said.
Mosena said there were state-owned entities that were created to assist struggling companies.
“If it is a question of finance, there must be assistance of some sort, if it is a question of marketing, the government must be able to go outside to other countries and assist in the identification of market for our industries, and if it is a question of productivity, there must be a way of enhancing productivity through re-engineering the production system and reskilling workers,” said Mosena.
KwaZulu-Natal Premier Thami Ntuli said it was regrettable that over 600 jobs were going to be lost, as families would lose livelihoods, “a devastating blow to the local community and our provincial economy”.
“The provincial government, in collaboration with national departments, labour unions, and sector stakeholders, is mobilising urgent support measures.
“These include expedited access to unemployment benefits and skills development programmes,” said Ntuli in a written response.
He said the closure of Assmang would affect the growing economic hub of Cato Ridge, the area that the provincial government was proud of for attracting significant and visible investment.
“This closure of Assmang calls on all stakeholders to ramp up job placement initiatives to assist affected employees in securing alternative opportunities.
“This development underscores the critical need for businesses to engage government early when facing operational challenges.
“Had we been approached sooner, collaborative interventions could potentially have mitigated job losses through tailored financial relief, diversification strategies, or partnerships to secure new markets,” said Ntuli.
He called on the private sector to view the government as a partner in navigating economic pressures.
He said proactive dialogue enables the government to deploy tools such as industrial funding, tax incentives, and export promotion support to safeguard both business sustainability and jobs.
“Engage with government before crises escalate. Platforms like the KZN Economic Council and Invest KZN are available and are appropriate for government and businesses to co-design solutions and inspire new hope.
“This can be through restructuring support, access to emerging sectors, or fast-tracking permits.
“Early engagement is not just a lifeline for companies; it is a shared responsibility to protect livelihoods and sustain economic stability,” Ntuli said.
He said the business and the government cannot afford to act in isolation from each other.
“This disappointing development must not dent our resolve but is a reminder that timely communication allows us to align with national industrial strategies and avert irreversible job losses.
“Let us, therefore, work hand-in-hand to future-proof our industries and communities,” he said.
One of the workers, who is the sole breadwinner in the family, said the future looked bleak as the family's lifestyle would have to change dramatically.
“Most of us who are working for this company are the only breadwinners in our families, and children who are attending the multiracial schools will have to quickly find alternative schools.
“Some of the workers have small businesses that they would depend on, but many of us will be joining millions of unemployed people in the country, which had a shortage of jobs,” said the National Union of Mineworkers activist, who requested not to be named for fear of being reprimanded.
He said that while the management seemed to have reached a final decision about the future of the company, workers were still putting pressure on directors to find a better solution than shutting down.
He said some of his colleagues came from other provinces, such as the North West, with their families.
“Now that they would be unemployed, they would have to pull their children out of school and go back home,” he said.
He said when the company first indicated in October last year that it was facing financial difficulties, the workers came up with ideas to save it from shutting down, “but the directors ignored us as they were not taking us seriously”.
Reacting to the retrenchments, EFF provincial spokesperson Chris Msibi said the workers were always victims of the management’s failure to control operation expenses.
“Any company that wants to retrench does not look at its expenses and costs holistically and they do not reveal the facts to any union that is representing the workers, but they would come up with this one solution, which is to retrench workers.
“As the EFF, we are totally against that because these workers are retrenched while not skilled to find other employment or to be self-employed.
“We are the first victims whenever there are problems,” said Msibi.
The uMkhonto weSizwe Party (MK Party) in the province said the potential closure of Assmang serves as a stark reminder of the human impact of policy decisions.
“The influence of the elite and capitalists on government policy poses a significant challenge.
“As long as this dynamic persists, the working class will continue to bear the brunt of decisions that affect their livelihoods,” read the MK Party statement.
When contacted for comment, National Union of Metalworkers of South Africa (Numsa) spokesperson Phakamile Hlubi-Majola said the union would respond in due course.