African Bank has started with the consultation process with its recognised union Sasbo to retrench more than a thousand workers. The bank says the COVID-19 outbreak and the associated protracted lockdown have added dire financial pressure on the company.
It has recorded a reduction in sales as well as collections, which has created excess capacity across the different business units. The bank says it has been gradually automating across operations and has implemented contactless banking through its digital platforms.
African Bank says the impact of COVID-19 on its operations and increase in digital banking platforms have led to the redundancies. The bank further says the current economic realities and imperative restructure may lead to loss of jobs.
The bank anticipates cutting 1 269 employees from the current 3 728 staff. In the preceding 12 months, the bank says they have not retrenched any employees for operational requirements.
Economy and job losses
The coronavirus has dealt the economy a major blow. It contracted by 51% in the second quarter of the year.
Nearly all industries experienced a massive drop in output. The construction industry was hardest hit, slumping further by 76.6%, the sector’s eighth consecutive quarter of economic decline.
Manufacturing output shrank by 74.9% due to work and expenditure on GDP tumbled by 52.3%.
Analysis of the impact of the coronavirus on the economy:
Two-point two million jobs were lost in the same period: