SA unemployment expected to increase by over 30%: Analysts

Analysts are predicting jobs bloodbath in the second quarter of the year as the impact of the coronavirus COVID-19 lockdown on employment becomes more evident.

Statistics South Africa is also expected to release its Quarterly Labour Survey numbers for the first quarter of this year soon.

Unemployment is expected to increase by just over 30% in the first quarter of this year from 29.1% in the last quarter of 2019.

Founder of, Mike Schussler says the job losses in the first quarter are largely due to the impact of load shedding, while job losses in the second quarter can be attributed to the coronavirus and the lockdown.

“The unemployment rate is probably going to go closer to 30% from 29,1%. I would expect it to be at least 29,5%, and the broader unemployment rate will be closer to 39%. But we must remember that this is just the beginning of the difficulties for South Africa’s labour market because the lockdown was only enforced for four days in March and most of the survey would have been done before we went into lockdown.”

COVID-19 Lockdown

Last month, Statistics South Africa on respondents losing jobs or businesses due to Coronavirus COVID-19 Lockdown indicated that 8,1% of respondents reported that they lost their jobs or had to close their businesses and 1,4% became unemployed, according to the Wave 2 survey on the impact of the COVID-19 pandemic on employment and income.

According to the report, almost nine in ten (89,5%) respondents who were employed before the national lockdown remained employed during the lockdown.

‘Job loss tsunami’

Labour Analyst, Terry Bell says a jobs bloodbath is on the cards for South Africa in the coming months. This as Statistics South Africa prepares to release the Quarterly Labour Survey numbers for the first quarter of this year.

In his weekly open letter to the public, President Cyril Ramaphosa said that a number of countries are facing a job loss tsunami as a result of the coronavirus pandemic.

Bell says a greater number of job losses can be expected in the retail and services sectors with the lowest-paid workers being the worst affected.

“There’s going to be a bit of a jobs blood bath partly because of what happened because of the reactions to the lockdown and COVID-19. People have already announced certain areas of job losses, SABC even, 600 jobs going there, 22 000 here, 70 000 there. I think a lot is going to come in the retail industry and in the services industry, particularly, restaurants that are closed, 2 000 restaurants are said to have closed, and many of them are never going to open again.”

SOEs on retrenchment path

Job losses are not only in the private sector, but State-Owned Enterprises like SAA, SA Express, and SABC are on a retrenchment path. President Cyril Ramaphosa has acknowledged that it is unfortunately the youth that will bear the brunt of being left jobless.