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The SA Daily 22 May 2020

Lockdown impact on incomes

Shireen Darmalingam

  • Statistics South Africa has released a report on the impact of the COVID-19 pandemic and the resultant lockdown on employment in South Africa. The data was collected between 29 April to 6 May 2020, coinciding with the extension of the lockdown. The results show that 69.5% of survey respondents were in paid employment before the lockdown, and 15.3% self-employed.
  • The lockdown shut business operations during the period, with many businesses having to permanently close their doors; this has had a significant impact on *incomes during the lockdown. Around 66.7% of respondents to the survey indicated that they received income from salaries and wages during the 6-week national lockdown; this is down from 76.6% prior to the lockdown. A similar trend was noted from incomes derived from other business which decreased from 8.2% prior to the lockdown to 2.5% during the lockdown. Worryingly, around 15.4% of respondents reported no income during the lockdown, from 5.2% prior to the lockdown. Reportedly, people are now tapping into savings and investments to meet financial obligations during the lockdown.
  • The survey results are concerning, especially as the unemployment rate will inevitably increase from its current 29.1%; estimates are pencilled in at between 40% to 50%. The Finance Minister commented recently that in a worst-case scenario, the unemployment rate could increase to as much as 50%, with 7 million South Africans without work. He also noted that the post-pandemic labour market would have to prioritise absorbing the millions of unemployed.

*There were 2,688 respondents to the survey, which does not represent the entire SA population.


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