Just as important as the industry dynamics, ownership and physical infrastructure are the working conditions, demographics and wages in the motor vehicles industry. This importance to many residents is predicated on the fact that they had a strong connection with the industry being dependent upon it directly by working in one of the plants or alternatively in one of their suppliers. So too did our family as a number of my relatives worked directly in an assembly plant as well. 

This blog deals with the human factors within this industry.

Main picture: Tractors ready for export

During the industry’s heyday, the appellation “Detroit of South Africa” would have been apt for Port Elizabeth, but that no longer holds true. Working conditions within the assembly plants were rather archaic in the early days not unlike their counterparts overseas. Over the years, the working conditions improved with regular working hours becoming the norm. Furthermore, a fundamental shift in the demographics on the shop floor from white Afrikaans to black Xhosa evolved over forty years.

Let us examine these factors in depth.

In the beginning, prior to the motor industry, most manufacturing businesses were small employing a few skilled workers who controlled a large number of unskilled workers. With no legislation regarding working conditions or even unions, most employees were reliant on the kindness and generosity of their employer as regards their welfare. Perhaps even indulgence would be appropriate. In this regard, nothing was to change initially when the motor assembly plants were established in Port Elizabeth. The norms and standards were initially perpetuated in the 20^th century assembly plants.

Ford’s singular innovation in the motor industry was the introduction of the assembly line. Combined with “scientific management” for dividing skills and routinising work, the modern assembly line led to rapid deskilling and fragmentation of work resulting in hugely increased efficiency, reduced costs and hence reduced prices

This popular preconception of what the assembly lines looked like Port Elizabeth is not apposite. Instead of moving assembly lines, these plants more accurately resembled modern airplane assembly where parts moved to a stationery plane with workers huddled around the stationary object.  History is replete with examples of where technology is poorly implemented and dispersed. This is one of them.

Assembly work fluctuated greatly. Numerous factors impacted upon vehicle sales such the business cycle, crop failures and changes in the model. The prevalent business model was not to carry large inventories of cards. Instead, the assembly plants preferred to close the factory and lay off the workers until the inventories were sold. This strategy was especially common at the beginning of the year when intensive efforts were expended to sell off all their stock of the old model. For the assembly industry this was a worthwhile paradigm but for the worker it was purgatory as they never assured of a job the following day. How they coped with erratic wages is inconceivable.

One wonders what the reaction of the workers would be when stocks started accumulating. Without a moving production line regulating the pace of production, would they as a matter of job preservation, slow their work rate.

The predominant type of work at these plants was bolting together cars which was correctly classified as unskilled work. Most workers could be rapidly trained and large numbers of workers could be employed simultaneously without affecting production. All assembly line and higher grade workers were white with Afrikaans speakers predominating. These were usually drawn from the platteland – rural – areas to which some returned during harvest time. This practice is still prevalent in Southern Africa as attested by my Zimbabwean gardener, who takes unpaid leave over planting and harvesting times.

Wage rates were reputed to be above the local minimums, varying between a starting rate of 2/- per hour for white male learners to 4/6d for skilled workers. The skilled employees did not work on the assembly line per se, but were employed as mechanics and repairmen.

Despite the high hourly rate, W.G. Ballinger representing the South African Trades and Labour Council in a visit to the Eastern Cape on September 1939, took a different stance. His report on Afrikaner labour in the motor industry criticised the low wages paid to workers and emphasised “that when short-time operates, they are well below the poverty line.” Whether this comment is factually correct, cannot be established. The current day analog would be large industrial concerns today, which tend to pay above industry norms yet seem to fall victim to a disproportion share of industrial action and grievances as compared with their smaller rivals.

What might have held more than a pinch of truth, is Ballinger’s observation that the motor firms objected to “interference by trade unions” which he claims that they resist “with typical American methods.” “In effect”, he wrote, “this means that attempts to organize the workers breaks on the rocks of victimisation.”

As Adler notes, “Management thus had its own means of dealing with workers’ complaints. In its crudest version, the unorganised workers could be easily sacked. One auto executive reminisced that in those days, an optimist was a man who brought his lunch to work, on the assumption that he would be around long enough to eat it.” Perhaps the latter comment is akin to the current adage that those who attend a prayer service for rain without their umbrella lack faith. Nevertheless, the sentiment is broadly true. Without either appropriate legislation or unions in situ, the fate of a worker was largely in the hands of management and its whims and foibles.

Probably in an attempt to extinguish the growing disquiet at the variability and unreliability of one’s pay packet, in 1938 General Motors introduced a sophisticated measured response. This took the form of a “wage stabilisation scheme.” In effect, this was an effort to cushion the wage effects of such fluctuations by giving each worker a known minimum annual income. Money owing to the worker above these minimums – such as overtime and bonus wages – was paid out as a lump sum at Christmas. This had the effect of tying workers to the firm for the year and stabilising the workforce.

As unemployment among white males declined in the late 1930s and during the war, even unskilled workers could leave an arduous job with the expectation of finding more desirable or lucrative employment elsewhere. Even at this stage, many Afrikaans workers would still regard their employment in the assembly plants as supplementary income as not as their primary source of income

Post WW2 changes

With Europe no longer mired in the quicksand of war and depression, its automotive industries flourished with massive expansion to meet pent-up demand. They would spread some of their pixie dust in the form of assembly plants to South Africa. In turn, the Americans had discarded their historical precedent of mass production uber alles by signing revolutionary agreements with the automotive unions. Furthermore, they had adopted Sloanism as the mechanism by means of which demand would be spurred on. The two pillars of this new philosophy were planned obsolescence and annual model changes.

These changes would filter down and impact upon the local assemblers who were also faced with a local requirement – local content.

“The most prominent symbol of the [local] transformation,” according to Adler “was the automated assembly line, installed in the three auto campanies [Ford, GM & VW] after 1948, thus giving management direct control over the pace of work for the first time in the South African industry.”

Adler continued that “The rudimentary elements of the Fordist drive system were thus falling into place. The new technology replaced worker subjectivity with conformity to an external controlled rhythm, enforced through a regime of relatively high wages and strict discipline meted out through despotic supervision. First line foremen possessed the power to grant incremental wages increases for workers. Unless they remained on good terms with supervision, a worker would have no other means to increase his wages short of a Wage Board investigation.”

Increased employment combined with changes in the intensity and conditions of work, led to the withdrawal of whites from the industry and their replacement by blacks.

Each phase of the development of the automotive industry had its own particular implications for labour. The all-white low skilled workforce, characterised by the first phase of development, was increasingly supplanted by a black semi-skilled workforce during this second industrial period.

Adler further presses the point that “the foreman’s disciplinary arsenal did not end with wage setting. He also enjoyed the ultimate discretionary authority: the power to hire and fire. The contractual basis for hourly-rated production workers was the so-called hourly basis.” Simply put, this meant that they could be fired at an hour’s notice. Given this power, it was open to abuse by vindictive foremen as there was no formal procedure for appeal. One retired worker sardonically commented that a foreman could fire a man for no other reason than he disliked the worker’s looks. While this might be hyperbole, it does highlight the foremen’s level of arbitrary discretion.

This new era might had witnessed the importation of certain techniques of Fordist management. However this does not imply the wholesale appropriation of the American factory regime. At even the most basic level, work in South African plants never duplicated the level of regimentation and fragmentation of tasks commonly associated with the American methods. Ergo, they never suffered from the same level of deskilling as their counterparts overseas.

This situation arose not due to some wilfully ignoring of their American bosses desires, but rather due to a local phenomenon which bedevils manufacturing today in South Africa vis-à-vis their overseas counterparts. The work was more complicated due to the high job content resulting from the many different tasks that a worker performed on the line. In addition, workers were required to shift from one model to the next on the same assembly line. Workers were compelled to master a number of different processes. Moreover, they were required to adjust quickly to new, and sometimes, different tasks. Driving this process was management’s determination to develop such interchangeability of staff, not only on the assembly line, but between sections of the plant to compensate for the ever changing workloads as different models were assembled.

Ironically, whatever local motives the automobile assemblers had for this practice, by all objective measures, this is the preferred way in which most employees prefer to work. Recognising the level of boredom for even the most “mentally challenged” employees, first the Swedes and then other European manufacturers introduced the concept of work enrichment. It was not so much that employers required multi-skilled employees to cater for the multiplicity of product lines, but rather to stimulate them mentally. The initial loss in productivity was usually rapidly compensated by invigorated employees whose interest in the job was stimulated.

These characteristics of work in South African automobile plants remains largely intact even to the present day as management has recognised the limit to deskilling and management control over individual tasks.

Adler noted that “the transformation of the labour process ended the pattern of instability in employment which characterised the pre-war industry. Total hours worked increased, varying between 40 and 46 hours for a 5-day week, with an annual paid vacation at the end and beginning of the year when the industry shutdown for Christmas holidays.” This increased regularity of employment, meant not only more routinised work but also the death knell of the previous character of the work force. Whereas previously the labour needs had been satisfied with unskilled white farmers, the plants now required the nearly constant engagement of workers. No longer was assembly work part time or seasonal as it now required full time engagement and commitment, becoming a career rather than a side course, but rather the main meal itself. The worker might still own a farm, but now that was their hobby and no longer their main interest and source of income.

Effect of post war prosperity on work patterns

The general economic expansion after the war, with its consequent reduction in unemployment among whites, made assembly line work less attractive to white workers. The increasing skill set required within the economy opened an array of supervisory and professional jobs to them.

Even within our own families, this trend is visible. If you take the McCleland family as an example, many of our parents were artisans whereas their children were professionals. In my case, my father was a carpenter by training whereas I am a Chartered Accountant by training.

Adler noted that “from its inception, automobile assembly work had been the near-exclusive preserve of whites, especially males. Though racial employment was not legally reserved, GM and Ford hired whites, and boasted of their employment practices. In the 1950s however, the historic pattern began breaking down, as it was in other manufacturing sectors.”

Assisting the graduation of whites from the lower rungs of factory work to supervisory and higher status jobs were the “WEE” – “White Economic Empowerment” – initiatives of the Nationalist Party government. While the WEE is merely an invention of my fevered imagination, the effect of the various elements of legalised discrimination bear the same hallmarks as the current obsession with BEE. This operated on two fronts. Firstly, through its job reservation policies, most senior jobs in the non-homeland areas was restricted to whites only. Furthermore, the expenditure on education of non-whites was limited to a fraction of that spent on whites on a per capita basis thereby further hampering their advancement. Combined with the dwindling flow of the industry’s traditional source of unskilled white labour from the farms and the reluctance of those that did so, to entertain the prospects of non- supervisory jobs, the acceptance of blacks into the manufacturing job market was advanced.

 

As those whites still willing to accept such “menial” jobs were viewed by employers as generally unsuitable for factory work, employers began to trawl in more non-frugal waters. Even the report by the Wage Board to the Minister of Labour validated the employers view by declaring that “a considerable proportion” of the available whites were of “the marginal shiftless variety.” What an indictment? But what else can one expect when scrapping the bottom of the barrel to employ white operative workers. They had far richer pickings when considering black workers for whom employment in the automobile plants rated as the highest paid industrial work available.

The SAMAD plant in Uitenhage which began assembling Studebakers under contract in 1949 became the third assembly plant in South Africa. Using this as the base year will highlight this shift from white to black employees. In 1949, white workers constituted 82% of direct workers employed in the assembly industry with coloureds comprising just under 5% and Africans slightly more than 13%. Let us look at the comparative figures for 1954.

Composition of direct workers	1949	1954
White	82%	54%
Coloured	5%	25%
African	13%	21%

The employment levels between these two periods was static due to the general stagnation in sales engendered by import restrictions yet white employment fell markedly.

Compare these figures with those in 1963:

Composition of direct workers	1949	1954	1963 – all depts	1963 – assembly only
White	82%	54%	41.7%	34%
Coloured	5%	25%	40.6%	49%
African	13%	21%	17.7%	16.8%

 

The Third Wave

Every wave of motor vehicle manufacturing brought its own changes to the organisational model adopted. This is turn impacted upon the workers as the method of organising work reflected those changes. In the case of the Japanese, the emphasis was on company-based unions, lifetime employment and quality circles which permitted them to focus on and stress quality mass manufacturing.

The labour relations system was linked to a manufacturing approach now known as “just-in-time” production. By means of this philosophy the objective of maintaining limited inventories was enabled by the close proximity between component suppliers and the assembly firms being “woven together within a single conglomerate.” With just-in-time, the Japanese were able to achieve considerable time and cost savings, enabling them to build more efficiently and with higher quality than was previously thought possible in mass-market products.

The production breakthroughs pioneered by the Japanese companies gave them an important advantage in small car production which allowed them to compete with their American and European rivals. In South Africa, they departed from their general pattern. Instead of setting up operations of their own in this country, they granted licences to South African entrepreneurs to establish locally-owned assembly plants.

Being local assemblers of Japanese vehicles as opposed to being owned by the Japanese themselves, these plants experienced the same lack of adherence to the production methodologies of their mother producer. The principle of just-in-time was adhered to more in the breach than by its compliance. In their labour processes, the multinational corporations operating in South Africa all followed the local pattern of low volume, low productivity and low economies of scale which prevailed at that time. It was only later in the 1980s that the Japanese companies began a transformation of their labour processes and labour relations to a pattern similar to that of the home country.

Over the fifteen years after the first Japanese entrant to the South African market, the statistics reflected the following changes.

 

The local content program not only encouraged the growth of the manufacturing industry but it also created the conditions for a central element of the Fordist system; a strong adversarial bargaining system between trade unions and management. From being dispensable and easily replaceable, the diversification of occupations and the skills required for manufacturing made workers relatively more difficult to replace. Hence, for the first time the power balance between workers and management had shifted inexorably.

Adler noted correctly that “the 1960s marked the beginning of a change in work relations in the industry which would soon threaten prevailing managerial control developed on the supervision-driven workplace of the 1950s.”

Rise of the Unions

The 1960s was not only the era of pop music, drugs and rock ‘n roll, but also for the workers in the automobile industry in South Africa, an era of workers flexing their muscles. At the commencement of the decade, there were no officially recognised unions in the industry, not even for white workers. Before the decade was finished, the situation had changed dramatically firstly as a consequence of government intervention and finally through intervention by international unions in support of the black workers in their organising efforts.

White workers were first off the mark. They organised using political leverage in the National Party to gain recognition for workers under the aegis of the Iron and Steel Union. In 1968, they pressurised authorities for the formal establishment of an Industrial Council for the Eastern Cape industry. Coloured workers were next to flex their muscles. Within three, they had gained recognition, thanks in part to resources provided by the International Metalworkers’ Federation and by TUCSA.

It should be recognised that these outside forces were only a catalyst. The real organising effort was conducted by the coloured workers at Ford and GM. Not only did they harbour grievances against the foreman-driven system but, more importantly, they possessed the ability to organise their fellow black workers, who now constituted a majority of the workforce in the factories. After it gained recognition in 1971, the Coloured union soon set its sights on organising black workers as well.

By 1980, the National Automobile and Allied Workers’ Union had emerged as the first and strongest non-racial national industrial union in the emerging labour movement, having achieved majority representation in all but one of the assembly plants in South Africa.

Demise of the proletariat

The globalisation of the Japanese production model and even its adoption by the companies applying the Fordist model, was to have severe consequences for the unions internationally. It might have been Thatcher who singlehandedly uprooted unionism in the UK, but it was the Japanese motor industry which destroyed the American Autoworkers Union.

The worker centric approach of the Japanese with their quality circles and kanban practices undercut Western motor manufacturers. Adversarial industrial relations were supplanted with co-operative joint problem solving. First it was the weakest of the American trio of vehicle manufacturers to succumb to competition from the Japanese: Chrysler. Using the spurious pretext of unfair competitive, the Americans applied restrictions on Japanese vehicle imports.

Needless to say the Japanese retaliated by constructing assembly plants in America’s backyard. They were stymied. Against the backdrop of declining and sluggish sales, American management and their equally unrepentant unions were dragged, screaming and shouting towards adoption of the Japanese model of automotive manufacture. Those companies that embraced it have weathered the storm. The recalcitrant, GM, is still languishing on becalmed seas. Their recent retreat from a number of formally profitable overseas markets is merely the culmination of their myopic behaviour.

In the 1980s, South Africa would have been be aloof from these frosty winds except that its underlying diseases of market fragmentation, small volumes and ramped up local content requirements.  From the early 1980s when a reasonable small car such as a 1600cc Ford Escourt could be purchased new at one month’s salary, prices exploded with multiple increments per annum. Demand faltered. The solution was industry consolidation with the merging of plants. Under pressure to disinvest, Ford grasped an opportunity to merge with Mazda in Silverton, Pretoria, forsaking a majority stake by only retaining a minority shareholding under its Canadian subsidiary.

In their efforts to pressurise the South African government, the Black Caucus in the USA Congress had scored an own goal. It was a Pyrrhic victory for the anti-apartheid coalition overseas at the expense of the South African worker.

Listening to the vitriolic comments of NUMSA on the disinvestment of GM from South Africa in May 2017, to me it was like déjà vu. The Ford workers in the 1980s did not want Ford to prop up the South African government yet they still wanted their salaries when the plant closed. Rationally that was never going to happen; a lesson that they would soon learn in their pockets.

Automation has continued apace. Logically in a country with huge reserves of unemployed people, automation in South Africa is almost an oxymoron.  Yet it is more like a syllogism. For example, the cost of utilising an automatic welder to weld together the steel panels on a vehicle might well be more expensive than using a manual welder, yet it not as accurate and consistent and hence less safe than its robotic welder equivalent. Taking into account other factors such as workers’ fatigue, vacations, absenteeism et al, automation comes into its own.

Quo Vadis

This does not imply that vehicle manufacturers will revert back to the archaic Fordist system of control whereby workers are merely a pair of hands without desires, thoughts and life itself. Far from it! Probably all manufacturing plants will ultimately imitate their European cousins in that they will be spotless with workers no longer attired in blue to hide dirt but rather dressed in white in order to highlight the dirt.

This is a work-in-progress. Which model of industrial relations will ultimately prevail is unclear. My crystal ball is murky but certain outlines can be discerned. Apart from cleanliness, it will in all probability be the requirement that supervisors and managers possess the requisite level of EQ. Perhaps this will henceforth be the overarching job requirement for those managing other people. Work is not divorced from society. To integrate the two and create a harmonious society requires respect for other people especially what I term the “little people.” These are people who are beneath one, usually performing the menial tasks in life. Respect them and treat them as equals in life and as people and they will respect you. Abuse them or misuse them and the cycle of unproductive recalcitrant staff will be perpetuated.

Source

From the “Liverpool of the Cape” to ”The Detroit of South Africa”: The Automobile Industry and Industrial Development in the Port Elizabeth-Uitenhage Region. By Glenn Adler in Kronos no 20 November 1993, pp17-43