In its latest release of unemployment data, Stats SA explains how, under Covid-19 conditions, it had to use different methods of enumeration.
The statistical note accompanying the Quarterly Labour Force Survey for the first quarter says: "Data collection was disrupted when Stats SA suspended face-to-face data collection for all its surveys on March 19 2020 as a result of the Covid-19 pandemic and restricted movement. This was to ensure that the field staff and respondents were not exposed to the risk of contracting coronavirus and to contain its spread."
The disruption that affected the collection of employment data is as acute as the upheaval we’ve seen in employment activity itself. But that won’t be evident from this week’s employment figures. The effect of disruption in economic activity will be revealed when the survey for the second quarter is announced.
What this week’s data does reveal is nevertheless of great concern.
I deliberately named this column "There shall be work", lifted from the Freedom Charter that led to the founding of the "new SA". But this week’s data shows we are faltering in achieving the aims set out in that document.
Stats SA tells us 306,000 more people joined the labour force in the first quarter, and a total of 960,000 joined the labour force between the first quarter of 2019 and the first quarter of 2020. In other words, nearly 1-million more people were available for work. However, there were only 91,000 jobs available, so 869,000 would have had to join the unemployment queue.
The result is that the unemployment rate has now breached the 30% mark (it’s at 30.1%).
Since Stats SA’s first-quarter data collection was disrupted, there has been dramatic disruption in employment itself.
Nearly 1-million more people were available for work, but there were only 91,000 jobs available for them
While 306,000 people came into the first quarter looking for work, 38,000 of those already employed lost their jobs. And things bode badly for the second quarter: the media has been awash with stories of struggling businesses. Clothing retailer Edcon, for one, has announced its intention to retrench about 22,000 employees. It is but one example.
Given all of this, there are some important things to be said about what the future looks like, and why some old notions about our unemployment problem must be abandoned.
Some analysts and commentators have insisted that the government, using labour laws, should make it easy to hire people, by making it easy to fire them. We will learn in the next employment numbers — when lockdown-induced retrenchments show up in the figures — just how easy it is to fire in this economy.
We have, of course, seen this before: in the aftermath of the global financial crisis, between 2008 and 2010, more than 1.1-million jobs were shed across the economy.
Second, it is important to note that the financial services sector lost 50,000 jobs in the period under consideration. This is concerning, because financial services is a sector that has displayed resilience over time, with some branding this the "financialisation" of the SA economy.
Third, this data shows us growth of 3,000 jobs in the informal sector in the first quarter. We also know that this sector was most severely affected by the Covid-19 lockdown, with government support not reaching it.
New imaginings
Most critically, the lockdown has taught us that new ways of being are necessary. We have learnt that we can work away from big office buildings, and do so successfully. The support services that until now have been used in big office buildings and office parks may also not be necessary any more.
We have also learnt to fear crowded spaces, and that fear will grow as the pandemic moves towards its peak — so malls and other spaces of human contact will struggle.
It is urgent that we reimagine the new world, taking into account the data, alongside considered discussions that go beyond our immediate individual interests. Going at it in silos will prove truly harmful.
More people are looking for work than before, and it seems fewer people will be needed in the economy — unless we shift our thinking.
- Payi is the founder of Nascence Advisory & Research
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