Pioneer Foods, South Africa to undergo job cuts

Pioneer Foods, a South African food manufacturer is cutting jobs as a part of its restructuring process in order to reduce costs regardless of the consumer spending - said by its chief executive on Monday.

Most of them including retailers and those who supply the sector in Africa’s biggest economy are under pressure as consumers with higher debt cut spending, while higher input cost and tougher competition hit  the margins.

Phil Roux, the pioneer chief executive said that reducing the step of reducing the bill was one of the initiative which the firm was undergoing to increase the profits and competitiveness.

Roux told Reuters that “We are decreasing the head counts and most of the work has been already been put into action.” However exact number for the job cuts in the group which makes breads, breakfast cereals and juices were not declared by him as the company was quite closure to the time to release its annual results next month.

According to a report from local media Pioneer would undergo a job cut of around 10% of its more than 12,000 employees. This job cuts will create emotional and political chords and are high on the government’s radar and can affect the elections coming up next year.

Income differences are mostly seen and the unemployment rate is officially around 25%  but most analysts says that the figure exceeds 40%.

As on 10:35 GMT, Pioneer shares were flat at 83.91 rand as compared to 0.15% rise in Johannesburg's All-share index.