The jobless rate of South Africa climbed to a further historical level of 32.6% in the first quarter of 2021, up from 32.5% in the fourth quarter of 2019.
The rate was the highest because the quarterly labour force survey began in 2008 when the quarterly poll was first conducted.
Africa’s most industrialized market has long been plagued by extraordinarily high jobless, keeping millions in poverty and contributing to severe disparities that remain over three decades after the end of apartheid.
Because of the COVID-19 epidemic, South Africa’s labour market has become even more difficult to navigate than usual. Before the country’s first coronavirus outbreak in March of last year, the economy was in recession.
In the first quarter, Statistics South Africa reported employment losses in construction, trade, private homes, transportation, and agriculture.
General Risenga Maluleke, the country’s chief statistician, told a news conference: “Construction has been down for a long time.”
Building and construction, with 87,000 job losses, contribute to 7.2% of total employment and 2.92% of GDP, whereas commerce accounts for 19.9% of employment and 16.2% of GDP.
An extended measure of unemployment, which includes discouraged workers, shows that 43.2 per cent of the labour force was unemployed in the January-March quarter, up from 42.6 per cent in the last quarter of 2020. Because of that increased rate, there were many people in South Africa who started to seek new opportunities to raise their income.
One of the most viral opportunities for unemployed people was bonus promotions in the Forex trading sector. During the crisis in South Africa, there were many brokers who started to give incentives to new traders. One of the pioneers among others was the XM Forex broker, which allowed newcomers to claim XM no-deposit bonus promotion in order to attract more customers. It is also worth noting that a year earlier, the country’s jobless rate was 32.5 per cent. Compared to 2008, this was the highest unemployment rate since comparable statistics began. Employment decreased by 28 thousand to 15 million, while the number of jobless people rose by 8 thousand to 7.2 million. As a result of the decline in construction employment, which fell by 87 thousand, trade employment fell by 84 thousand, private employment fell by 70 thousand, transport systems’ services slipped by 40 thousand, and agricultural production employment decreased by 18 thousand, and yet banking and finance employment soared by 215 thousand. A record high of 63.3 percent was set for the young unemployment rate, which measures job-seekers aged 15 to 24.
COVID-19 and its Effect on South Africa
A new round of political and social turmoil in areas of South Africa has brought to light South Africa’s underlying structural issues. In addition to high levels of poverty for a moderate to the high-income nation, excessive income inequality indicates that a major portion of the population is considerably poorer than the average, as well as high levels of joblessness
As South Africa’s socio-political atmosphere shifts, hunger is becoming a more prominent aspect of the country’s inequality problem. While the concept of hunger is inherently a subjective one, questions on hunger are frequently included in brief surveys to gauge respondents’ food status. This has been cited by several analysts as one of the root reasons for the turmoil.
According to the most current NIDS-CRAM survey, 15% of respondents had experienced this in the week before they were questioned for the study.
This rise came after a nearly 20-year drop in hunger. One of the main reasons why South Africa achieved progress was the establishment of the Child Support Grant in 1998 There has been a reduction of hunger among children and adults from 2002 to 2019.
The quality of the meal, on the other hand, had not improved.
Child assistance grants and modest economic development were responsible for reducing hunger in the early 2000s, although this trend halted following the financial crisis of 2008.
Fortunately, the economic shock induced by the epidemic and lockdowns halted the downward trend. Aside from that, the NIDS-CRAM surveys revealed that hunger appeared to have reached a new plateau.
A nationwide representative assessment of South Africa’s socio-economic condition was needed, and the NIDS-CRAM study was created to satisfy that requirement. Each of the 11 official languages of the country was surveyed five times over the phone, with a nationally representative sample.
Researchers were able to have a better understanding of the shifting circumstances during a time of significant volatility as a result of this. An urgent need for up-to-date and nationally representative data was met by the survey, which came at a critical point in the policy-making process.
Using a panel poll, the same respondents were surveyed five times. Early next year, between May and June of 2020, the first round of interviews will take place, shortly after the tight lockdown was imposed.
Every participant was questioned about their hunger in the seven days prior to their interview, as well as if they had enough food in the month prior. In this way, researchers could see how respondents’ and their families’ circumstances were changing.
Overall, hunger levels were higher than they had been before the first lockdown.
Although many respondents said they had been short on funds for food in the initial interview, hunger impacted fewer homes. This may imply that some homes were able to make ends meet in some way, at the very least to alleviate hunger in their households. During the second round of data gathering in July and August, after the initial severe lockdown had been lifted, researchers noticed modest improvement. As a result of a partial economic recovery, increased payments of current social benefits, as well as new grants for social relief and the Temporary Employer-Employee Relief Scheme, this has occurred.
The government, non-profits, and faith-based and community-based organizations all provided food assistance.
These beneficial results, however, did not persist long at all.
There has been a decrease in food insecurity since the first lockdown, in terms of not having enough money to buy food. In March 2021, it was much lower than in April 2020. As a result of the first sharp drop, both family and child hunger decreased.
In addition to some economic growth, this was likely due to government decisions to increase grants and introduce new ones as well as other assistance measures.
From October 2020 onwards, the government will gradually phase down emergency social assistance and social insurance in an effort to manage government debt and focus public health expenditures.
The conclusion of April 2021 marks the end of all types of emergency aid. In April 2021, the value of social grant increases that were below inflation decreased as well. This was accompanied by a decline in the amount of food assistance supplied to impoverished households by the government, non-profits, and community-based institutions.
Numerous provinces have yet to implement the National School Nutrition Programme (NSNP). This resulted in a weaker safety net. The rise in unemployment placed millions of individuals in a precarious situation.
Despite its modest monetary worth (R350 or roughly US$24 per month), the Social Relief of Distress award provided temporary access to close to 6 million jobless individuals who were ineligible for unemployment benefits and the Temporary Employer-Employee Relief Scheme (TEERS) In April 2021, these perks will disappear.
Without the special distress relief award, poverty among the poorest households would have increased by 5 per cent, and income inequality would have increased by between 1.3 per cent and 6.3 per cent. A further 25 percentage points were added to the chance of looking for work as a result of the award.
A lot of the unhappiness that is being voiced in communities around the country may be traced back to these fundamental issues Social protection and emergency aid can also help stabilize families and communities.
In the absence of these efforts, hunger would surely have become worse, with potentially long-term repercussions for children’s development and societal cohesiveness.