Construction contributes to job growth in South Africa, and plays a significant role in informal sector employment, but the full socio-economic impact - measured in the destruction it leaves in its wake in poor, vulnerable and often remote communities where projects are implemented - is far from acceptable. This needs to be noted and addressed as a matter of urgency by project owners, contractors, subcontractors and government, particularly those large-scale construction projects in rural and peri-urban areas.
Janine Espin, MD, Economic Development Solutions
A recent Construction Industry Development Board report
indicates that the construction sector accounts for around 10% of total formal employment (1.1-million jobs) and 16% of informal employment (430,000 jobs).
Unintended long-term impacts
In a country where unemployment is high and growing, the arrival of a construction crew, whether to build roads, renewable energy facilities or other public or commercial infrastructure projects, is a welcome source of potential income and jobs for poor communities. However, if badly managed, the unintended long-term impacts can damage lives, and the community irrevocably.
Opportunity for the community arrives in the form of housing the construction workers, providing entertainment, and increased sales of goods and services. Young men will abandon their education for a job opportunity and young women are easily led into relationships without a future. When the crew leaves town, it leaves single mothers behind who must rely on government support, young men without a basic education, and large segments of the community with an income gap and debt they cannot service. This increases the cycle of poverty.
Failing to identify and address the socio-economic impact prior to construction commencing is irresponsible and can no longer be excused. Furthermore, fragmented ownership of the project exacerbates this challenge and needs to be addressed by the construction sector, business and government.
Who owns the project?
When some companies win big projects, they subcontract to many specialists to get the job done. Their focus is on profits. There is often little concern for environmental, socio-economic or other impacts unless these are specified and the project owner (in this case the unprincipled business) is held responsible.
When large contractors subcontract parts of the job - whether its bush clearing, grading of roads or constructing critical facilities - they want to know the subcontractor can deliver on the job; they are rarely concerned with where the labour is sourced, how subcontractors ensure the health and welfare of workers, or what policies are put in place to protect communities.
Implementing and enforcing responsible practices can be hard to do as there are few formal policies in place that address these issues. While skills development, broad-based black economic empowerment (B-BBEE), specifically pertaining to the construction sector transformation charter and labour legislation, may specify requirements for skills development, minimum wages and benefits to protect workers - this supports growth of the local economy through local procurement and supplier development requirements, there are few specifications around safeguarding the communities in which construction companies must work.
Tenders should incorporate compliance requirements
Strategies to support socio-economic and labour policies should be mandatory for all stakeholders, and importantly, must be implemented and enforced. Project owners can then ensure that construction contracts are awarded to companies that are compliant, or willing to comply with these policies. Furthermore, tenders should incorporate compliance requirements such as local procurement, local employment and local community upliftment programmes.
Government also has a key role to play, by providing the framework for policies and, importantly, enforcing them. They should also assist by supplying agencies with skills to help implement these policies, and by incentivising construction companies through tax breaks or other measures to put these policies into practice.
What might these policies encompass and how could they be implemented cost-effectively by even smaller, growing companies involved in the construction process?
Building communities alongside infrastructure development
All stakeholders will need to collaborate to deliver on these policies.
- An effective first step is to visit the area selected for the construction project to understand the socio-economic status of the surrounding communities, the availability of skills and labour, and any special considerations - e.g. is there any volatility or special considerations (high prevalence of Human Immunodeficiency Virus (HIV).
- Engage with the local municipality to understand the needs of the community and potential impacts on available resources, such as water, sewage, energy, medical facilities.
- Engage with the community through community leaders — church leaders, elders, teachers, shebeen and other business owners and the parents in the community — to drive awareness of the potential long and short-term impact of the project (and the entry of construction workers) on the community.
- Actively address potential issues together with non-governmental organisations (NGOs) and government agencies. For example, making condoms and birth control, youth and family counselling, ensuring clinic services are available. In addition, it is important to introduce financial planning and other forms of educational programmes to help the community manage potential income growth and avoid future unserviceable debt.
- Create internal policies that mandate construction companies awarded segments of the project are willing and able to implement awareness campaigns and key socio-economic and labour policy requirements. These may include:
- Putting in place awareness programmes around the prevention of sexually transmitted diseases (STDs), unwanted pregnancies, and the impact of alcohol abuse.
- Mandating engagement with local municipalities or social services agencies.
- Ensuring local employment and skills transfer where this is feasible.
- Putting in place an exit strategy that will leave the community better off rather than leave a catastrophic gap.
Creating these policies need not be arduous nor should they unnecessarily burden smaller construction companies. With a multi-pronged approach and the collaboration of all stakeholders, it is entirely possible.
As a company with considerable experience in the socio-economic development arena, we are keenly aware of how just a few simple considerations can change lives positively and help communities grow. It’s a small investment into creating a positive legacy your company will be proud to leave behind.