Economists have called for swifter action to kick the economy into gear after it emerged that South Africa has lost nearly twice as many jobs in this year’s second quarter than in the same period last year.
Statistics South Africa’s (Stats SA) report on the last quarter’s employment figures saw the country shed 69 000 jobs, a staggering 35 000 more than in the previous year’s second quarter.
Investment economist Dawie Klopper said this, coupled with the concurrent recession, should bolster government into decisive action over policy and legislation gaps, which he said were stalling economic growth.
Klopper added that while recession was directly linked to job losses, there was more that the government could do.
“Yes, definitely. We need economic growth in order to generate employment. If we have slow economic growth, the impact will be felt almost immediately in employment. There is a direct correlation between the technical recession and the job losses we are seeing,” Klopper said.
“We need to be growing at a rate of at least 4% in order to start generating the numbers we need. And [President] Cyril Ramaphosa is doing his best, but the problem is that the confidence in the country is very low because of the land debate. Until we can solve that, we are going to struggle.”
According to labour analyst Mamokgeti Malopyane, the current employment figures also needed to be viewed beyond the recession and in the context of some of South Africa’s biggest contributors to the economy.
He highlighted the mining industry as one of the main contributors to the massive job losses, but said there were areas of improvement which government could look into to stop the bleed.
“I think it has to be looked at [against] the backdrop of an economy that has already been struggling and with a mining industry that has been haemorrhaging jobs which as you know constitutes one of the biggest employers as a sector.”
A lack of clarity and policy direction in the Mining Charter as well as in mining legislation was stalling potential investment into the sector.
The department of home affairs took a lashing, with Klopper highlighting the tourism sector as a potential growth area for jobs, as well as the GDP.
“I think we might still be able to generate confidence in other areas, as we have seen with the announcement by [Malusi] Gigaba on the visa regulations, which were meant to boost tourism. But he has gone about it in the most confusing way. I think he is really sabotaging the president in the way he is doing this thing.”