South Africa has lost 2,2 million jobs since the first quarter of 2020, it is the biggest quarter-on-quarter loss since 2008. And yet the latest unemployment figures released by Statistics South Africa on 29 September 2020, indicate that the unemployment rate has decreased with 6,8% to 23,3% during the second quarter of 2020.
This is misleading and inaccurate seeing as the definition of being unemployed does not include those persons who are not actively looking for a job. People were obviously unable to actively look for jobs during Levels Five and Four of the national lockdown. Thus, the number of people who are not economically active has increased with 5,6 million. This statistic reflects the true state of affairs and the seriousness of the unemployment crisis in South Africa.
Statistics South Africa itself has warned that comparisons to previous quarters and years’ data must be made very carefully seeing as the latest survey figures are not based on a comprehensive sample of the population.
South Africans must not be under any illusions as the fact of the matter is that the country is facing a serious unemployment crisis and skewed unemployment figures will have a detrimental effect on the search for and implementation of solutions.
Taking the number of job losses into account, the Department of Labour’s excessive emphasis on, for example, equal employment through implementing quotas for the workplace accompanied by more stringent legislation instead of focusing on job creation initiatives in these desperate times, speaks volumes.
It points to the ANC government’s misguided priorities and sheer inability to manage a crisis.
The government aid provided during the pandemic, in the form of the Temporary Employer-Employee Relief Scheme (TERS) of the Unemployment Insurance Fund (UIF), is just a drop in the ocean and it not sustainable.
The support offered to small business enterprises fell far short and these enterprises and the private sector were to a large extent incapacitated for several months on end.
The Minister of Labour frequently lays the blame for retrenchments and other problems in the labour market at the door of the private sector, but government aid to the private sector, the biggest job creator in the country, is inadequate. The government is more focused on redressing than on job creation and that is why the country finds itself in an unemployment crisis.
The expanded unemployment rate of 42% is even more alarming seeing as it includes job seekers who have lost hope. At present, there are already more people in the country who are dependent on social grants than people who are working and the fiscus simply cannot handle the pressure any longer.
The possibility of a basic income grant, as envisaged by the government, is doomed to fail and will only serve to make South Africa more of a welfare state than an economically sustainable country.
The third quarter’s unemployment figures should provide an indication of whether the government was successful in turning around the unemployment bloodbath caused by the lockdown, as long as the surveys are conducted on a normal basis.
That is, unfortunately, unlikely seeing as the government has always focused only on short-term social aid and cosmetic transformation targets instead of helping small business enterprises by implementing the necessary structural reforms that are needed to bring about economic growth and job creation.
Read the original article in Afrikaans by Heloïse Denner on FF Plus
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