Newsletter 5 - The economic downturn and unemployment - 23 January 2009
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The global economic downturn has placed immense pressure on South Africa’s development goals of halving poverty and unemployment by 2014. Municipalities are often criticised by the members of the public about the poor living conditions in which the majority of the South African population live. Yet, local government has significantly less jurisdiction than the provincial and national governments to achieve the goals of reducing poverty and unemployment.
The global economic downturn has placed immense pressure on South Africa’s development goals of halving poverty and unemployment by 2014.
The Minister of Finance, Mr Trevor Manuel, said in his medium-term budget policy statement speech in October 2008; that the national treasury expected global economic growth to slow for several years. South Africa’s gross domestic product (GDP) growth, which measures the total cost of all finished goods and services produced in the country, is also expected to slow dramatically. This is expected to have a negative impact on employment figures.
Statistics South Africa defines unemployment as those in the economically active population - (aged 15 to 65) and are either employed or seeking work. - who:
- Have not worked during the last seven days prior to being interviewed;
- Want to work and are available to start work within a week of the interview by Stats SA;
- Have taken active steps to look for work or to provide themselves with self-employment in the four weeks preceding the interview
The ‘strict’ or official unemployment rate is the proportion of the economically active population that conformed to the above definition. The ‘expanded’ definition does not require a person to have actively sought employment.
The number of unemployed people according to the strict definition increased by 118.1%, from 1 988 000 in 1994, to 4 336 000 in 2007. The strict unemployment rate increased from 20.0% in 1994 to 27.5% in 2007. During the same period, the number of unemployed people according to the expanded definition increased by 113.5%, from 3 672 000 in 1994 to 7 839 000 in 2007. The expanded unemployment rate decreased from 31.5% in 1994 to 21.6%.
|
Year
|
1994
|
2000
|
2006
|
2007
|
|
Unemployment rate (Strict)
|
20.0%
|
26.7%
|
25.6%
|
25.5%
|
|
Number of unemployed (Strict)
|
1 988 000
|
4 333 000
|
4 275 000
|
4 336 00
|
|
Unemployment rate (Expanded)
|
31.5%
|
35.5%
|
39.0%
|
38.3%
|
|
Number of Unemployed (Expanded)
|
3 672 000
|
6 553 000
|
7 958 000
|
7 839 000
|
Source: The South Africa Survey 2007/2008
According to data released by Statistics South Africa, the unemployment rate increased from 4.114 million people in the second quarter of 2008 to 4.122 million people in the third quarter of 2008 – an increase of 0.2 percent, or 8 000 people. International trends have shown increases in the unemployment rates in countries such as the USA, having shed 1.2 million jobs by November 2008. If this trend is reflected in South Africa, the country’s unemployment rate must also be expected to increase.
Municipalities are often criticised by the members of the public about the poor living conditions in which the majority of the South African population live. Yet, local government has significantly less jurisdiction than the provincial and national governments to achieve the goals of reducing poverty and unemployment.
Included in the objectives of local government as per the Constitution, is the task to promote social and economic development.
The municipal outreach project will assist local government to ascertain the poverty challenges specific to their municipalities, and to determine the policy interventions to best eradicate these poverty challenges, given local government’s powers to eradicate these challenges.
The municipal outreach project widely disseminates research findings using the project website, www.eumunicipaloutreach.org.za. The Fast Facts for Local Government (F3LG) is a monthly publication that covers research on over 170 indicators in each issue. An annual South Africa Survey will be published. The Survey covers information on socio-economic issues, and contains information on demographics, the economy, business and employment, education, health and welfare, living conditions and communications, crime and security, and politics and governance. All publications are sent to municipal councillors and officials, and development organisations, using the project website, via e-mail, or postage.
Workshops will be conducted in each of the municipalities covered in the project. The Major Urban Poverty Challenges Identification (MUPCI) workshops, will take place in 2009. The workshops will be designed for elected councillors and officials to identify what they see as the major poverty challenges facing their constituents.
The Urban Poverty Intervention (UPI) workshops that will take place in 2010 will explore policy interventions appropriate to the challenges identified in the MUPCI workshops.
The Anti Poverty Intervention Implementation Proposals (APIIP) workshops that will take place in 2011 will formally propose the policy interventions identified in the first two years, and will identify the most effective means to implement the policy recommendations.
The Municipal Outreach Project requires the participation of the municipalities, and development organisations in order to jointly determine and implement interventions that will aid the country in combating poverty.
- Nthamaga Kgafela
by
nkgafela
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last modified
2009-01-23 08:38
