Pandemic brings South Africa’s unemployment rate to record high

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South Africa Economic Development

According to data released on Tuesday, more than one-third of South Africa’s workforce will be unemployed in the second quarter of 2021. This data illustrates the efforts of Africa’s most industrialized economies to escape the effects of the pandemic.

In the three months to the end of June, the official unemployment rate rose to 34.4%, the highest level since the start of the unemployment survey, and higher than the 32.6% in the first quarter—about 7.8 million people in total.

The statistics list the scale of the economic crisis facing President Cyril Ramaphosa and his African National Congress, despite the slow speed of Covid-19 vaccination, structural weaknesses (such as limited access to education), and the consequences of infighting. They are still trying to reopen the economy at his own party.

Business groups estimate that tens of thousands of jobs in the country were at risk last month. The worst riots after apartheidThe power struggle of the African National Congress over the imprisonment of former President Jacob Zuma led to arson and attacks on infrastructure in Gauteng and KwaZulu-Natal, which contributed to South Africa’s GDP Half of it. Hundreds of people were killed in the riots.

Economists warn that the unemployment rate will worsen in the third quarter due to the effects of the chaos and the recent lockdown measures to contain the coronavirus.

Independent economist Thabi Leoka called this situation a “crisis.”

“When most of the working-age population is unproductive, the economy cannot grow,” she said. “Small businesses and the informal sector are struggling under the restrictions of the lockdown.”

The government recently eased some blockade measures, including allowing gatherings again last month. In the third wave of the epidemic, the number of hospitalizations across the country seems to have reached its peak, but South African scientists have warned that the fourth wave of epidemics may appear by the end of this year.

More than one-tenth of South African adults are vaccinated; the government’s goal is to vaccinate all 40 million adults in the country by the end of the year. The government opened up vaccination to all people over 18 years old last week.

Black women have the highest official unemployment rate, about 41%, and more than half of unemployed job-seekers have less than a high school degree.

South Africa’s ancient apartheid boundaries, such as the placement of black towns far away from urban economic centers, have made it more difficult for many people to find stable jobs.

Taking into account the other 4.1 million people who were discouraged or gave up looking for work but were not officially counted as unemployed, 44.4% of the nationwide were unemployed, up from 43.2% in the first three months of this year.

The Ramaphosa government resumed a temporary subsidy of 350 rand ($23) per month for the unemployed last month. But because of the scale of structural unemployment in the country, his cabinet is considering a plan for permanent basic income transfer, although this will put pressure on public finances.

South African Finance Minister Enoch Godongwana (Enoch Godongwana) Recently replaced Veteran Tito Mboweni expressed the need for this kind of cash transfer, but this month said that unemployed young people “need more than subsidies and social support” to find a job.

Leoka said, especially the high youth unemployment rate is a “time bomb.”

“In 10 years, this age should be in leadership positions, managing companies, government departments and top universities, but they lack the necessary foundation,” she said. “Their fate paints a bleak picture of South Africa’s future.”

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