Geoff Jacobs, President of the Cape Chamber of Commerce and Industry joined Benito Vergotine to unpack the effects of the SAA strike. 

Listen to the conversation here: SAA strike will only hasten its demise

More than just the fate of South African Airways is at stake should members of the National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) go on strike tomorrow.

At its core is a fundamental clash between those who think magically and those who deal with market realities. The resolution of this divide is critical to the overall economy.

It is time to be blunt about the choices involved by unions faced with collapsing enterprises. In this case, either SAA is given one last chance to haul itself out of the financial hole decades of mismanagement have put it in, or the strike goes ahead, the airline collapses, and everyone employed is without a job.

Union members and their leaders will have to face the fact that they can do nothing by striking but hasten the demise of SAA. The best to be hoped for is that a drastically slimmed down airline returns to profitability and begins to pay back the millions of taxpayers’ money it has borrowed.

A strike now will not preserve the 944 jobs the unions are hoping to save. It will merely put all 3 000 at greater risk.  Demanding an 8% above inflation increase in pay is equally nonsensical.

SAA’s salary bill is already 24% of its total costs, its cumulative losses are more than R2 billion and next week it hopes to get an equivalent amount in taxpayer loans – because no one else will.