Madikwe Game Reserve, South Africa – Investment and Employment - Responsible Tourism: Critical Issues for Conservation and Development - page 251

the hands of local residents.
Recent legislation, effective from July 2007 stipulates a minimum cash wage
of R1650/month ($236 at the exchange rate of R7 to 1US$) for employees in the
hospitality industry. In Madikwe this will increase total annual earnings (only
lodge employees) by R275,000 (an average increase of around 18.7 per cent for
those qualifying), mostly to local employees. Assuming a household size of six
persons dependent on one earner's minimum wage (using a dependency ratio
suggested by Massyn and Swan, undated), the average earnings per household
dependant amount to around $40/month or $1.33/day. This is a low figure but
this should be seen in the context of a region which in the early 1990s employed
fewer than 100 poorly paid individuals on cattle ranches.
Casual labour (commissioned for ad hoc projects and not covered by formal
employment contracts) has not been investigated for the current study but
ongoing repairs and maintenance and works projects in the reserve add anywhere
between $285,000 and $715,000 per annum to local pockets.
In total, from the enterprises evaluated in both the 2003 and 2007 studies,
with some adjustments referred to in preceding paragraphs, cash income earned
at the Madikwe cluster is estimated at somewhere between $6.43 and $7.43
million/annum. The minimum and maximum are dependent on the extent of
casual wages and gratuities for which accurate 2007 figures are not available.
Using the known employment profiles, at least $3.29 million per annum is likely
to end up in local households. By comparison - under a livestock ranching, dry-
land farming regime - cash income to local employees would amount to possibly
$100,000/annum, 3 per cent of the above figure.
In 1999 Rutec (cited in Koch and Massyn, 2003) estimated that the villages
and settlements around Madikwe numbered 1775 households. Allowing for some
growth to 1850 households in 2007, this translates to an average of $1778 cash
earnings/household/annum or $148/month/household. This figure should be
added to the pre-existing average 1999 estimate of $225/household/annum (SA
rands, inflated for seven years and converted to US$). The approximate total
household earnings are therefore now in the region of $373/month. Based on
these figures, tourism has boosted average local household income by 65.7 per
cent, a considerable average increase over eight years.
Concluding from Table 12.1 and the analysis above, the figures for local
residents show a rising proportionate share of numbers of people employed in
2007 (74.4 per cent) compared with 2003 (65.5 per cent) showing far greater
recruitment of local residents as defined, but the distribution ratio (ratio of local
employee numbers to earnings) shows little change. This indicates that the rapid
growth of numbers in the Madikwe cluster has not been accompanied by an even
more rapid conversion of local earners from unskilled to skilled labour. The local
skills deficiency identified in the area by Relly (2004b) persists in 2007. If destina-
tion developers aim to maximize local socioeconomic benefit, they must include
training in their capital/revenue expenditure budgets. Madikwe was fortunate to
benefit from a DfID programme which helped to address this policy failure to
some extent.