The fight against COVID-19 is felt throughout South Africa. The economy is suffering and the unemployment crisis has skyrocketed as a result of lockdown restrictions.
In his weekly newsletter addressing the nation, President Cyril Ramaphosa said that the expected job and business losses due to the lockdown were becoming more apparent.
“For a country which was already facing an unemployment crisis and weak economic growth, difficult decisions and difficult days lie ahead,” Ramaphosa said.
Industries expected to be hit the hardest by incoming unemployment are aviation, entertainment, construction and hospitality. Smaller companies outside of these sectors are also expected to experience loss.
However, this is not unique to South Africa. Countries across the globe are experiencing the same situation as the COVID-19 pandemic worsens.
“In April the International Labour Organisation forecast there would be around 305 million job losses worldwide. The situation of workers in the informal economy is even worse, with an estimated 1.6 billion workers in danger of losing their livelihoods,” wrote Ramaphosa.
Since the beginning of lockdown, thousands of South Africans have lost their job and dozens of small businesses have closed their doors for good.
According to a survey by Bloomberg, South Africa is expected reach a 29.7% rate of unemployment.By this point, South Africa will have reached its highest unemployment rate known to Bloomberg since it began recording data in 2008.
South Africa’s unemployment rate increased by 0,1 of a percentage point to 29,1% in the third quarter of 2019. According to the Quarterly Labour Force Survey (QLFS) released by Statistics South Africa, this is the highest unemployment rate since Stats SA started measuring unemployment using the QLFS in 2008.
A 7% contraction of the South African economy is expected this year, which is the highest since the Great Depression. More details are expected when Minister Tito Mboweni gives his revised national budget in parliament on Wednesday, June 24.
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