South Africa recovered 2 million jobs lost during lockdown – but there’s a catch

South Africa’s job market has staged a significant recovery, according to the latest National Income Dynamics Coronavirus Rapid Mobile Survey (NIDS-CRAM).

The NIDS-CRAM is a study conducted by a national consortium of 30 social science researchers from local universities, as well as groups like the Human Sciences Research Council and the Department of Education.

The survey is a comprehensive and nationally representative survey of how the Covid-19 pandemic and lockdown impacted South African households, with a particular focus on income and employment.

The first wave of the survey found that approximately 2.8 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.

The second wave survey showed that these numbers had not changed from April to June, despite the easing of lockdown over the period.

The latest survey, however, has shown a positive turn, with approximately 2.1 million jobs returned.

“NIDS-CRAM Wave 3 data shows evidence of a substantial job market recovery in October 2020 compared to April (Level 5 Lockdown), and June (Level 3 Lockdown),” the researchers said.

“Between February and April 2020, we had previously found a substantial increase in those who were not employed – from 43% to 52%, as well as an increase in furloughed workers. We now find that by October 2020 the percentage of people employed is much closer to its February pre-pandemic level.”

The fraction of people employed, including furloughed workers, has changed from 57% (February), to 48% (April and June), to 55% in October.

“While there is always a margin of error around survey estimates, and there have been some changes in the number of working age adults over the period, these results suggest a considerable recovery between June and October 2020,” they said.

The catch

A notable finding from the survey is that the 2.1 million jobs recovered were not all people who were previously employed, returning to work.

In fact, the researchers found that these workers only made up around half of the figure, with the rest comprising a mix of people previously unemployed before the pandemic, and new entrants into the market.

This means that approximately 1.8 million previously employed people who lost their jobs over lockdown have still not recovered.

“This suggests substantial churning in the labour market, which no longer looks the same as it did prior to the pandemic-inspired lockdowns,” the researchers said.

The researchers also warned that the picture could have changed over the last quarter of the year, with the results from Wave 4 of NIDS-CRAM expected to shed more light on whether the recovery and adjustments to the labour market are sustained in January 2021, or whether the move to Adjusted Level 3 at the end of December 2020 compromised the upward trajectory.

Other highlights from the report include:

• Job recovery was stronger for those with more education, especially among the youth;
• The substantial recovery in employment was greater for men compared to women;
• Employed women were also working two fewer hours per week on average in October compared to February, while men’s working hours were back up to pre-Covid levels;
• The survey’s employment recovery findings are consistent with Stats SA monthly production and sales data.

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