SA’s employment numbers have clearly bounced back as the economy has re-opened. But it could take a decade for SA to regain all the jobs lost as a result of the coronavirus crisis, if it doesn't do something different to drive higher levels of economic growth.
That’s the word from economists at PwC, who estimate that the economy may have shed a net 1.3-million to 1.4-million jobs last year. This means up to 2-million more people may be looking for jobs this year compared to a year ago, if the almost 600,000 new job seekers who come on to the labour market each year are included.
“It’s not a pretty picture,” said PwC chief economist Lullu Krugel.
This week Stats SA’s jobs data release for the fourth quarter of 2020 will be closely watched to see to what extent the jobs market may have recovered.
PwC’s bearish estimates are in contrast to the startlingly strong jobs recovery shown in a new survey, which found that though 2.8-million people lost their jobs in the hard lockdown between February and April, this was largely reversed when 2.1-million people found employment between June and October.
But results from the National Income Dynamics — Coronavirus Rapid Mobile (NIDS-CRAM) survey, released this week, show that these were not necessarily the same people — only half of those who lost their jobs in the hard lockdown found employment later in the year. It also found that levels of hunger and deprivation had increased despite the job gains. And it found that the impact on women was much greater than on men.
“Our main finding . is that active employment in October has recovered dramatically since its low point in April 2020, with active employment in October being statistically indistinguishable from February pre-pandemic levels,” wrote researchers Ihsaan Bassier, Joshua Budlender and Rocco Zizzamia.
“This is a startling result given the scale of the employment loss in April.”
This was the third wave of the NIDS-CRAM survey, which is led by a group of 30 social scientists at universities across SA.
It provides a unique level of detail on communities and how they have been affected — economically, socially and in health terms — by successive waves of the coronavirus crisis.
However, it is not representative of the population as is the official labour force data from Stats SA, which samples 30,000 households each quarter whereas NIDS-CRAM draws on a panel of just 6,000.
Economists speculate it may have overestimated the extent of the losses in the second quarter as well as the extent of the gains by the fourth quarter.
Stats SA’s official fourth-quarter labour force numbers are due out only this week and will be closely watched to see whether they support the NIDS-CRAM survey trends.
— NIDS- CRAM survey
— This is a startling result given the scale of the employment loss in April
Stats SA reported last year that 1.7-million fewer South Africans had jobs in the third quarter compared to the same quarter in 2019, before the pandemic.
Just 543,000 of the 2.1-million jobs lost in the second quarter came back in the third, the agency reported, with SA's unemployment rate rising to 30.8% — one of the world’s highest.
The NIDS-CRAM and Stats SA numbers won’t yet include the impact of the employment stimulus package which President Cyril Ramaphosa said in his October economic recovery and reconstruction plan would create 800,000 job “opportunities”.
Ramaphosa said in his state of the nation address last week that by the end of January 2021 more than 430,000 opportunities had already been supported through the stimulus, with a further 180,000 in recruitment.
And he promised that: “We will continue to support employment for as long as it is necessary while the labour market recovers, even as we work to promote stronger and more resilient growth in the private sector.”
With the R13bn that was allocated to the Presidential Employment Stimulus already spent, finance minister Tito Mboweni’s budget this week is expected to allocate further funds over the next three years to the employment programme, which Ramaphosa costed at R100bn when he announced his supposedly R500bn Covid stimulus and relief package in April.
The “opportunities” are mostly in the form of temporary jobs and subsidies. In a report last week the presidency said more than 300,000 teachers’ assistants had been hired at a cost of R7bn, with a further R600,000 going to support early childhood development and hire social workers.
Almost R2bn has gone to expand existing public employment environmental programmes; among other projects are support for subsistence farmers and for SA’s creative and cultural sectors as well as maintenance work on provincial roads and municipal infrastructure.
