South Africa’s Unemployment Rate Hits 17 Year High in Q1 2020

South Africa’s Unemployment Rate Hits 17 Year High of 30.1 Percent

Unemployment rate in Africa’s most industrialised economy South Africa rose to a 17-year high in the first quarter of the year, the Statistics South Africa revealed on Tuesday.

The unemployment rate rose from 29.1 percent filed in the final quarter of 2019 when the economy plunged into recession to 30.1 percent in the first quarter of 2020.

This was before the coronavirus outbreak that grounded global businesses and disrupted the world’s logistic chain.

South Africa’s unemployment rate has remained above 20 percent for more than two decades due to slow economic growth over the years.

In a weekly letter released to the nation on Monday, President Cyril Ramaphosa said the projection that COVID-19 pandemic would force businesses to shut down and hurt jobs, both existing and new job creation, has started crystalising across the nation, more than three months after the virus first hit Africa’s second-largest economy.

On Thursday, a report published by the Rand Merchant Bank and Stellenbosch University’s Bureau for Economic Research shows that business confidence dropped from 18 in the first quarter of the year to 5 in the second quarter as business managers are not optimistic about the second half of the year given weak economic fundamentals and low business activities.

“Covid-19 has drastically changed the already-weak economic landscape and perhaps, in some cases, permanently,” said Ettienne le Roux, RMB’s chief economist. “We are likely only beginning to fully appreciate the complexity of the economic impacts of this pandemic.”