Big job losses in South Africa – Here are the sectors which are the worst affected

Big job losses in South Africa – Here are the sectors which are the worst affected

The Commission for Conciliation, Mediation, and Arbitration (CCMA) opened its offices across the country on Monday 18 May, and immediately experienced a big influx of people who lost their jobs.

This is the feedback from CCMA director and CEO Cameron Sello Morajane, who was speaking to the SABC about the impact of COVID-19 on the South African jobs market.

Morajane said they are receiving many complaints about salaries which are not being paid, about salary cuts, and about staff being forced to take leave.

Many of the CCMA cases are due to retrenchments caused by small and medium-sized businesses closing down.

There has also been an uptick in large businesses retrenching staff on the back of the lockdown and COVID-19 pandemic.

Morajane previously told the Centurion Rekord that small businesses – the biggest producers of employment in South Africa – were particularly hard hit.

“When these businesses close, our unemployment rate will start to soar,” Morajane said.

The worst affected sectors

Morajane said the worst-affected sectors, which are producing the highest number of CCMA complaints, were:

  1. The business and professional sector.
  2. The retail sector.
  3. Private security (safety and security).
  4. Food and beverage, including restaurants.

Morajane expects the situation to get worse. He said many companies are cash strapped and will either not be able to pay salaries or even have to close their doors.

“We expect the number of CCMA complaints to increase in the next three months – it will not go down,” Morajane recently told eNCA.

Economic contraction

South Africa’s economy will take at least three years to recover from the effects of the COVID-19 pandemic and the national lockdown, according to Nedbank economist Busisiwe Radebe.

The South African Reserve Bank expects the country’s GDP to contract by 7% this year, which is in line with Nedbank’s estimates.

GDP per capita – a measure of a country’s economic output that accounts for its number of people – is a good measure of a country’s standard of living.

South Africa’s GDP per capita peaked in 2014 and showed a steady decline after that since the COVID-19 crisis hit the country.

Nedbank’s economic models around the impact of the COVID-19 pandemic and the lockdown show it will take at least three years to reach pre-crisis peaks.

“When it comes to things like employment, we see that taking even longer to reach the pre-crisis peak,” said Radebe.

“We will still be in this mess trying to undo it three years from now.”

CCMA CEO Cameron Sello Morajane interview