Charting a digital future: labour in the era of the transformation of South Africa’s automotive and agricultural sectors

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A tale of two sectors

South Africa ranks as the most highly digitalised economy in Africa. This is demonstrated by the high uptake of new digital technologies in various sectors, including manufacturing and agriculture. The diversified agricultural sector contributes significantly to the country’s economic growth and employment. Noticeably, over the past few years, the sector has been gaining ground in terms of digitalising and mechanising farming activities and processes. While the integration of new digital technology is transforming the sector, questions arise as to the impact and cost to the labour force.

Automation in the form of sorting and grading robots and crop harvesting robots, the use of predictive analytics and AI (e.g. for yield forecasting and pest outbreak detection), Internet of Things (IoT-enabled) soil and climate sensors coupled with automated irrigation sensors, including drip irrigation systems, and drones (for pesticide application or soil monitoring) combine with the high level of mechanisation to trigger both negative and positive sentiments, depending on the stakeholders in the sector.

Not to be outpaced by the agricultural sector is the country’s manufacturing sector (automotive industry), which is also increasingly mechanised and digitalised. The sector is deeply embedded in the global automotive supply chain. South Africa produces cars for both its local clientele and for export. By targeting the international market, it gains significant chunks of foreign currency, offsetting its trade balance. Through mechanisation and digitalisation, the automotive sector can also produce huge volumes of cars and address the drudgery of menial work associated with the sector.                                                

My fieldwork research conducted in South Africa [1] laid bare the positive and negative ways new technologies continue to shape the country’s automotive, service (banking, retail) and agricultural sectors. Here, I focus on two sectors that have been highly mechanised and automated within the country – namely the automotive industry and agriculture – to demonstrate the impact on the labour sector following the uptake of digitalisation and mechanisation. One of the key areas is job displacement, especially for the low-skilled labour force. This is particularly concerning if there are no substantial investments in reskilling and upskilling at firm, sectoral and national policy levels.

On the flipside, opportunities also arise in terms of how digitalisation is spurring productivity, efficiency and output. This can enhance South Africa’s global competitiveness in terms of the production of more vehicles at globally competitive prices. The same is also true of the agricultural sector, which boasts high-quality exports through horticulture, citrus and wine production. However, this is not the whole story.

While some view automation as the gateway to flexible work arrangements, enhancing work efficiency, output and job satisfaction, fears loom large that it could also lead to task intensification, job insecurity and sentiments of disempowerment and anxiety, especially among the less skilled (or unskilled) workforce. The South African case study shines a light on this issue.

Mechanisation, robotisation and jobs in the automotive sector

In South Africa, a country often touted as leading the way in the adoption and use of new ­digital technologies in Africa, most emerging and established companies are increasingly using new digital technologies to lessen the burden of tedious work. At the same time, some employees and segments of labour unions fear the uncertain outlook for the future of jobs.

At the Volkswagen South Africa (VWSA) plant in Kariega (Uitenhage), the company has introduced robots and a high level of mechanisation, and in the process boosted efficiency and productivity.

While the labour component has been affected as a result of technological integration, other macroeconomic factors have also been identified. For instance, as the fieldwork was coming to an end, the Mercedes Benz South Africa (MBSA) plant in East London, in the Eastern Cape, was mulling over plans to cut 700 jobs, citing issues of operational inefficiency owing to macroeconomic challenges.

Workers and trade unions such as the National Union of Metalworkers of South Africa (NUMSA) fear that instead of improving job quality, digitalisation will result in some workers losing their jobs because of robotisation and automation, especially in the car manufacturing sector. Throughout the fieldwork research, some respondents cautioned that to say digitalisation will replace work in South Africa is too technologically deterministic. They point to the varying degrees of tech adoption coupled with the unevenness of the application of new technologies in the country.

It is evident in the South African context that the uptake of digitalisation and mechanisation is contingent on several factors, including industrial policy, strong unions, cost of acquisition of new tech (capital outlay), cost of labour and competition among firms.

The South African automotive sector is embedded in the Brazil, Russia, India, China (BRICS) bloc. Secondly, it has expanded under various investment cooperation schemes. This is clearly seen in how South Africa has opened its doors to European companies such as Volkswagen (VW), Mercedes Benz and Jendamark – all German companies. It may be that with automation and robotisation, these firms improve work intensity and speed to remain globally competitive.

Upskilling and reskilling

In South Africa, there were strong sentiments that new technology divides the workforce into low and high skills, thereby generating inequality in the workplace. Seeming to overlook these dynamics, the South African corporates are quick to highlight the accompanying processes of upskilling and reskilling and the futureproofing of jobs. However, the South African trade unions, particularly in the manufacturing sector, see the situation differently.

Despite the robot-to-human pairing, the trade unionists from NUMSA whom I interviewed cautioned of job transformation in the automotive, tyre and rubbermanufacturing sectors, with workers having to adapt and acquire new skills and competencies. Nevertheless, it is likely that in some cases this will result in job displacement.

Whilst it is easy to sound the alarm, the challenge lies in the need for more solid empirical data (statistics and figures) on how many jobs have been lost owing to digitalisation and automation within the South African automotive sector. The other sector significantly impacted by digitalisation and mechanisation is the agricultural sector.

Will new technology replace gloves, eyes and baskets in the horticultural sector?

Most South African commercial farmers are striving for efficiency through precision farming. For example, they are using electronic drip irrigation systems, in which probes are inserted in the soil to measure moisture levels. After Spain, South Africa is the second-largest citrus exporter in the world and continues to employ a huge labour force within the global value chain. Analysts note that the sector will become partially rather than fully automated.

The fruit-picking and grading processes are still done by hand, thus resisting the pressure of task automation. Sundays River Citrus Company notes that even though humans (mostly female labour) do the sorting and quality control in the back end, the loading of boxes from the field to the packhouse now involves some mechanisation, shifting away from the traditional use of manual labour.

Packhouses also use cameras to check the colour and size of the fruit before sending it to different distribution points. In addition, the boxes used for packaging now involve some digitalisation, as evidenced by the use of barcodes. There is context to the use of these barcodes, with South African agriculture being embedded in global value chains (GVCs). The sector is buckling under pressure from customers in the Global North, who insist on traceability and demand fruit that has not originated from places without decent work practices.

Notably, the decision of farmers on whether to use machines or manual labour is not based on charitable motives, but is largely driven by profit- and efficiency-seeking. When it is cheaper to do things with machines, they use machines. When it is cheaper to employ humans, they resort to manual labour. Not only that, but the nature of the tasks also informs such decisions.

Again, looking at the South African horticultural sector, the picking is still being done by hand. This is because some production systems still require some level of manual dexterity, which machines lack. This explains why in South Africa, female graders and sorters dominate the sector, albeit on a seasonal basis.

Whether female employability in the sector is positive news, the issues around work intensity, job insecurity, quality and satisfaction should not be overlooked.

Digitalisation policy and labour implications

Just as with any technology, digitalisation and mechanisation present significant opportunities for some, as well as posing challenges for others. Large-scale commercial farmers who can afford to invest in high tech can reap huge profits through efficiency, high productivity and (at times) reduced labour costs.

Tech companies also stand to benefit. For instance, South African drone companies involved in the agricultural sector are more or less guaranteed recurring revenue through ongoing technical advice, maintenance and software updates for their clients.

With the shift towards digitalisation and mechanisation in traditional manual farm labour processes such as planting, irrigation, harvesting, sorting and packing, many workers will face precarity. The same holds in the automotive sector, where low-skilled workers on production lines may lose their jobs. This is particularly concerning in the wake of ongoing restructuring, which is already resulting in job cuts at these plants. Labour unions thus face significant challenges in wage bargaining and lobbying for decent work in such environments where jobs are diminishing.

On the other hand, automotive giants such as VW and Mercedes Benz in South Africa stand to benefit as automation enhances efficiency, reduces operational costs and thus enhances these firms’ global competitiveness. Whilst the low skilled are at risk of being displaced by robotisation, skilled technicians, engineers, programmers and data analysts will continue to benefit as these firms mechanise and automate their production lines. The same is true for software and technology providers.

It is reasoned that by supporting the digitalisation policy, the South African government can help create jobs and make firms globally competitive, thereby increasing the country’s foreign direct investment. It is worth noting that the uptake of digitalisation and mechanisation in both sectors requires a measured approach in order to strike a balance between the positives and negatives, especially in the interest of protecting labour.

Policy recommendations

At a policy level, South African stakeholders should look at the impact and benefits (negative and positive) of digitalisation, especially in terms of human labour. To this end, policy considerations around upskilling and reskilling of labour become relevant.

Again, labour unions should push policymakers to consider digital skills training at the firm level (in both the agricultural and automotive sectors) to help workers adapt to new technologies. Such workforce readiness programmes will help address fears of job loss and insecurity characterised by the uptake of digitalisation and mechanisation in the two sectors.

Even though digitalisation and mechanisation processes are still not fully fledged in most farms and manufacturing industries in the country, data-driven policy adjustments must inform policy-making decisions. However, this is only possible through regular monitoring of employment levels, trends (at firm, sector, region and national level), wage patterns (differentials) the (digital) skills divide and requirements for new entrants and the existing labour force.

[1] The researcher conducted fieldwork in South Africa in May-June 2024.