Home South African 700 workers at City Varsity, Damelin face retrenchment

700 workers at City Varsity, Damelin face retrenchment

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That is almost half its permanent staff.

Cape Town – Educor – the owner of Damelin, City Varsity, Intec College and Lyceum College – is planning to retrench more than 700 people from its workforce; almost half its permanent staff. 

This comes on the back of increased business insolvencies in the fourth quarter of last year, according to StatsSA, as companies struggle to stay afloat due to a weaker economy and the impact of load shedding.

The privately-owned Educor brands employees received an internal memo dated February 7, sent to 1558 permanent employees.

The memo said the higher education group was materially affected by the poor economy, which was leading to fewer enrolments and a growing number of students not paying fees.

Educor chief operating officer,Michael Thurley said Educor Holdings Group’s first year enrolments were 20% lower than last year. They were 48% behind sales budget for this year, which corresponded with a decrease in student fees.

Thurley said the reason for the proposed retrenchments was based on financial and operational requirements. “We regret to advise that no voluntary severance packages or early retirement packages will be offered.”

ANC deputy chief whip in the provincial legislature and the party’s spokesperson on education Khalid Sayed said it was concerning so many employees were facing the risk of losing their jobs, especially with the country’s high unemployment rate.

Sayed said the decline in enrolment of students in TVET (technical and vocational education and training) and other privately-owned colleges was due mainly to a lack of proper career guidance in the basic education space.

DA spokesperson on higher education and training Professor Belinda Bozzoli said the economy was in such a bad state that people did not have the income to spare to pay for themselves or their children to further their education.

Bozzoli said it would help if the government were to provide a subsidy to private institutions that were of the right standing and quality.

Good party secretary-general Brett Herron said: “The situation at Educor is not unique – small and large businesses are experiencing the same crunch as less money is circulating through the economy.

“Falling enrolments because of the economy, means school-leavers are unable to find work and their families are unable to pay for them to acquire further education and skills. This sets up a vicious cycle of unemployment and poverty.”

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Cape Argus