At least 20 000 employees are predicted to lose their jobs as textile factory companies threaten to close shop.
The surging withdrawal rate of textile factory investors due to the Covid-19 pandemic is projected to wound the employment industry of Lesotho with the already skyrocketing statistics of unemployment rate.
The irate National Clothing and Textile and Allied Workers Union (NACTWU) Sam Mokhele came down heavily on the government’s inability to rescue the sinking ship amidst the prevailing job threats.
This follows the looming closure of some of the leading textile factories in the country inter alia; J&S garments whose manager announced that he is propelled to sack over 800 workers.
“The owner said he is no longer able to get more orders from his customers and therefore has no other options but to shut the factory.
“We tried to talk to him to convince him otherwise,” he said.
According to the 2020 World Bank report Lesotho has a Gross Domestic Product (GDP) of $861 per capital and classified as lower-middle-income country.
“In recent years, Lesotho’s economic performance has been negatively affected by sluggish global economic growth amid a major downturn in emerging markets and advanced economies as well as natural disasters.
“Real GDP growth rate is estimated to have contracted by 1.2%, 0.4% and 9.5% in 2018, 2019 and 2020 respectively and projected to recover to overage 3.0,” the report reads.
The World Bank states that in 2019 the unemployment rate was 22.5% and stretched to 24.6% in 2020 before accruing to 24.40% by the end of 2021.
One of the leading textile manufacturers, Nien Hsing International earlier on chopped about 2500 workers from employment owing to a decline in Denim Jeans demand.
TZ ICC has also made claims to release about 80% of its workers owing to lack of orders which stemmed from Covid-19 scourge. He quickly said they were able to convince the employer not to totally shut down but divide his staff in to two groups that will work interchangeably on weekly.
“We believe that they make a lot of money but they under pay Basotho because no one is helping the workers earn what they deserve,” he said.
Mokhele explained that the government does little to nothing to salvage the already exacerbated problem, adding that the Minister of Trade and Minister of Labour and Employment displayed impassive efforts of keeping the investors throughout all their meetings.
Meanwhile, UNITE Secretary General Potloloane Monare said another factory J&S Garments had also announced that it shall close business on April 28 and release over 800 workers while Asia Garments intents to sack 400 workers by April 14.
Monare said they suspect that the shutting down is a strategy plotted to deny workers from getting more salaries as the gazette is yet to be announced and employers may be avoiding the salaries increment.
He said some of workers are retrenched in smaller factories and be newly hired in the bigger factories owned by the same employers or organizations. Monare also blasted the government for not being responsible in saving the jobs of many workers that may negatively affect the economy of Lesotho.
Responding to the matter, Lesotho National Development Corporation (LNDC) issued a statement on which the escalating job losses in the textile manufacturing industry were addressed in August 2021.
LNDC announced in the statement that in an endeavour to save the jobs, the corporation gathered and engaged the relevant stakeholders on the matter.
Among the stakeholders are the companies that mentioned the disruption on the supply chain that broke out due to Covid-19. The companies also mentioned the issue of deteriorating investment climate as one of the issues affecting the business negatively.
The corporation mentioned in the statement that the Inter-Ministerial Task Team (IMTT) which was led by the Ministry of Trade and Industry was formed to address the investors’ grievances.
The corporation had assured the public and the workers then that that it was observing all the necessary avenues to save their jobs.
Increased production costs, reduced production due to social distancing regulations, cross border travel amongst other are mentioned as some of the factors that affect business.