President Cyril Ramaphosa is one lucky fella. Under intense scrutiny from his political adversaries and private-sector coffers, the president has skirted accountability for the latest unemployment rate which tells a harrowing account of South Africa’s economic future.
Did SA’s unemployment rate really drop?
On Tuesday, Statistics South Africa (Stats SA) piled on the confusion around our updated jobs figures when it revealed that the official unemployment rate decreased to a shocking 23.3% in the second quarter (Q2) of 2020.
That’s a drastic drop of 6.8 percentage points from Q1 of this year.
In case you’re confused, this is what it all means
However, it is important to note that Stats SA made a clear distinction between the two definitions of unemployment that were observed in the quarterly labour force survey.
Official unemployment refers to jobless persons (aged 15-64 years) who:
- were not employed in the week that the survey was conducted; and
- actively looked for work or tried to start a business in the four weeks preceding the survey interview; and
- were available for work, i.e. would have been able to start work or a business in the reference week; or
- had not actively looked for work in the past four weeks, but had a job or business to start at a definite date
in the future and were available.
In terms of this definition, official unemployment saw gains, taking South Africa’s jobs rate down from 30.1% to 23.3%.
In contrast, Stats SA defines expanded unemployment as people aged between 15 and 64 years who:
- were not employed in the week that the survey was conducted; and
- were available to work but did not look for work either because they are discouraged from looking for work
(see definition of discouraged work-seeker) or did not look for work for other reasons
By this definition, South Africa’s expanded unemployment rate rose by 2.3%.
“This is reflective of the fact that people were available for work but did not actively look for work,” Stats SA explained in the report.
Here’s why Ramaphosa holds the W
Both sides of the coin represent two possibilities of South Africa’s economic future. It is either we’re forced to measure our economy from a smaller pool, or freak out over the lack of morale in our labour market.
Ramaphosa, by default, is cleared of all accountability in this blunder. The general consensus, it can be argued, is that the president was acting in good faith when the country went into a nationwide lockdown, in March.
It was the ultimate sacrifice he mentioned in every emergency PSA broadcast over the lockdown period. With the country beaming up at Alert Level 1, perhaps the next two quarters will prove to be the true test of Ramaphosa’s leadership.