South Africa Reports 7.2 Million People Unemployed
New figures released by Statistics South Africa show the impact of the coronavirus pandemic on the country’s employment rate. In the final quarter of 2020, the unemployment rate increased by 1.7% to 32.5% (7.2 million people)
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Unemployment figures show no sign of slowing
Statistics South Africa have released the results of the Quarterly Labour Force Survey based on the final quarter of 2020. The current rate of employment is the highest on record, with millions of South Africans currently seeking work.
Bloomberg has reported that the coronavirus restrictions have resulted in the country’s worst economic performance since the Great Depression. The current number of unemployed people in South Africa stands at 7.2 million, while there are just 15 million people employed.
Impact of coronavirus on South African economy
The government had issued special pandemic payments (Social Relief of Distress grants) to financially assist applicants who were struggling as a result of the COVID-19 pandemic. In early February, it was announced that this payment would be extended for another three months.
While the R350 (approximately £17) per month payment has been welcomed, it has been criticised for not going far enough to support South Africans who are out of work and unable to find new employment.
The massive unemployment rates are a challenge for the government who have earmarked R13 billion (£627 million) to stimulate the economy and create more jobs.
There is a fear that these new economic challenges will result in further destabilisation in the region. Between 2000 and 2020, the unemployment rate in South Africa stood at around 20%. Experts have identified a lack of market opportunities as barriers to creating new jobs.
‘South African variant’ resulted in travel ban
Following reports of a more contagious strain of the virus (501Y.V2) that was first reported in South Africa, a number of countries including the US and the UK issued travel restrictions to South African residents.
The UK placed South Africa on its ‘red list,’ which meant that non-UK nationals could not enter the UK. Anyone with UK nationality was required to undertake a mandatory quarantine for 14 days at a cost of £1,750.
Positive news as COVID-19 infection rates slow
However, there has been some positive news as South Africa announced in mid-February 2021 that it was reopening its land borders following a drop in COVID-19 cases.
As it currently stands, South Africa has reported a total of over 1.5 million cases of coronavirus infections, and almost 50,000 deaths. In an effort to combat the epidemic, South Africa has reportedly reserved 9 million doses of the Johnson & Johnson vaccine.
It remains to be seen how the country will deal with the impact of coronavirus on the country’s economy in 2021, with the IMF predicting a possible jump of 3% in GDP.
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The poor 2020 employment figures are related to the impact of the coronavirus pandemic
[Image credit: Unsplash]
