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<\/a><\/figure>\n\n\n\nThe scale of South Africa’s informal economy is difficult to pin down due to its ‘off the books’ nature.<\/p>\n\n\n\n
Previous estimates of the scale from groups such as Standard Bank had pegged it at around R1 trillion.<\/p>\n\n\n\n
More recently, Stats SA revised and rebased its GDP data for the country and expanded the net of informal contributions to what it calls the “non-observed economy” (NOE).<\/p>\n\n\n\n
Before the revisions, the NOE accounted for roughly 7.3% of GDP, capturing traditional informal activities such as spaza shops, informal taxis, street hawkers, shebeens, and informal recycling.<\/p>\n\n\n\n
Following the change in data, the NOE expanded to 8.7% of GDP, incorporating broader categories, including informal and illegal activities such as illegal mining, e-hailing, and gambling.<\/p>\n\n\n\n
As a result of the changes, the NOE increased from an estimated R487 billion to about R608 billion\u2014though many still believe this is an underestimation.<\/p>\n\n\n\n
Former Capitec CEO Gerrie Fourie has long been critical of the official data on the informal economy, particularly in terms of scale and jobs.<\/p>\n\n\n\n
He said South Africa faces a significant challenge in understanding the local informal economy and how many individuals are employed in it. <\/p>\n\n\n\n
This is because much of the economy is undocumented and untraced and simply does not appear in economic statistics on GDP and employment. <\/p>\n\n\n\n
He famously expressed the view that, in reality, unemployment in South Africa is between 10% and 15% because of these gaps.<\/p>\n\n\n\n
He has also expressed the view that South Africa’s social grants system is part of the reason, as many informal workers would actively try to hide their employment status to cash in on government grants.<\/p>\n\n\n\n