The political, social and humanitarian consequences of 2.2 million people in South Africa losing their jobs tower above the risk of Covid-19. The lockdown should be abolished immediately and drastic mitigation measures, such as a moratorium on the minimum wage, should be introduced without further delay. Piet le Roux, CEO of the business group Sakeliga, is of the view that “this is the least that the government can do for the unemployed and businesses after an irresponsible state of lockdown that paralyzed businesses, employees and society nationwide”. Le Roux furthermore observes, “South Africa is becoming a hotbed for political and social instability, not to mention the decline in life expectancy due to economic deprivation. The most important aid packages are not more government debt and stimulus packages, but the abolition of harmful labour restrictions, as with the proposed moratorium on the minimum wage.” Statistics South Africa’s quarterly Labour Force Survey (QLFS) shows that the working population decreased in the second quarter of 2020 by a devastating 2.2 million people from 16.4 million in Q1 to 14.1 million in Q2. The employment rate – the number of people working in relation to the working-age population – tumbled to a shocking 36.3%, from 42.1% in the previous quarter. The reality is that the employment rate, at present, gives a more accurate picture than the current unemployment rate.
The 16% decline in GDP from the first to the second quarter of 2020 is a man-made disaster. Recovery starts with ending lockdown, which a responsible government would do immediately, including opening international air travel and not extending the state of disaster beyond its next expiry date on 15 September. The next step on the long road to recovery will be to bring about an unprecedented roll-back of the state […]