Sacci: Senior retrenchments not unusual

Sacci says several companies globally are slashing costs by reducing their number of top earners.

Sacci says several companies globally are slashing costs by reducing their number of top earners. Picture: Pioneer Foods (Pty) Ltd

CAPE TOWN - Senior and middle management retrenchments are not normally made public because of the sensitivity around such moves, the South African Chamber of Commerce and Industry (Sacci) said on Monday.

Paarl-based manufacturing giant Pioneer Foods is the latest company to embark on a mass retrenchment drive of senior and middle management employees.

Its Chief Executive Officer Phil Roux said reducing the wage bill was one of the initiatives the firm was undertaking to increase competitiveness and enhance profitability.

In September, around 400 top-level employees at retail giant Pick 'n Pay got retrenched.

Sacci CEO Neren Rau says there is a global trend as several multi-nationals are slashing costs by reducing their number of top earners.

But Rau says senior level job losses are not placed in the public domain as managers are barred from joining a union.

"When it comes to more senior levels of management, they generally don't take to the streets as we see with the unionised workforce."

Rau said Sacci was aware of several multinational companies in the country being forced to downscale in lieu of leaving the country altogether.

He says the job cuts option is a better for the country as it has a more minor impact on the economy compared to closing shop entirely.

"If they decide that the South African cost environment is not conducive, [they could] turn their attention to other economies."

At the same time, a national recruitment agency revealed there is an influx of CV's from retrenched employees.

The agency says this has placed the employer at an advantage as there's a glut of skilled people desperate for a job.

This means some employers are also driving hard bargains and offering reduced salaries.