KwaZulu-Natal’s MEC for finance Nomusa Dube-Ncube says that the coronavirus pandemic and economic issues have had a dramatic impact on employment in the province.
Tabling the second annual adjustments budget in the provincial legislature on Tuesday (24 November), Dube-Ncube said that Q2 2020 was particularly damaging for the province at the height of the country’s lockdown.
She said that the provincial GDP growth rate fell by a ‘devastating’ 51.6% during this period.
“Our projections indicate that economic growth in the province will contract by at least 9.1% this year, before moderating to 1.5% next year,” she said.
“The largest negative contributors to the provincial economic growth in the second quarter of 2020 were mining and quarrying, which contracted by 75.5%; constructions by 75.3%; manufacturing by 75.1% and wholesale and retail trade, hotels and restaurants by 68.9%.”
Dube-Ncube added that the rapid increase in liquidations has led to a distressing rise in the expanded unemployment rate, which is currently estimated at 47.5% in KwaZulu-Natal compared to 43.1% nationally.
“This implies that five out of ten people in KwaZulu-Natal are unemployed,” she said.
National data from Statistics South Africa shows that the total number of forced and voluntary liquidations increased by 54% in September as compared to the same month last year.
Results of the third Quarter Labour Force Survey (QLFS) published by Stats SA has put South Africa’s unemployment rate at 30.8% – 43.1% on the expanded definition, which includes discouraged work seekers who have given up looking for jobs.
Nedbank forecasts that around 500,000 jobs will be lost in South Africa this year, with the country’s labour market only set to reach the pre-crisis peak in the second half of 2023.
In July, a team of South African researchers have published the National Income Dynamics Coronavirus Rapid Mobile Survey (NIDS-CRAM) which looks at the economic impact of the coronavirus pandemic, and countrywide lockdown.
The study surveyed 7,000 South Africans and can be considered the most nationally representative survey that currently exists, the researchers said.
The key finding was that approximately three million people lost their jobs over the lockdown period, representing an 18% decline in employment from 17 million people employed in February, to 14 million people employed in April 2020.
Accounting for a 95% confidence interval, the decline in the number of people employed from February to April was likely between 2.5 million and 3.6 million, the researchers said.