Stats, Damn Stats and Lies: The State of Unemployment in South Africa

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Lies, damned lies, and statistics” is a phrase describing the persuasive power of numbers, particularly the use of statistics to bolster weak arguments. It is also sometimes colloquially used to doubt statistics used to prove an opponent’s point.

The term was popularised in the United States by Mark Twain (among others), who attributed it to the 19th-century British Prime Minister from (1874–1880) Benjamin Disraeli(1804–1881): “There are three kinds of lies: lies, damned lies, and statistics.

There are times when I feel that South Africa’s unemployment stats are just lies, damned lies. Unfortunately they are not. The number of people I pass every morning lifting their fingers waiting for a piece job for the day is increasing everyday. It is difficult to ignore that these stats are actually a reflection of our increasing reality.

The following are some of the stats released by the Statistics South Africa:

In SA we have 19.8 million youth;

SA’s official unemployment figure is 5.2 million people (ages 15-64); 

  • 5 million unemployed
  • 3 million employed
  • 7 million economically active

South Africa’s unemployment rate is 25%. South Africa’s unemployment rate has been averaging about 25.27% from 2000 until 2015. 

Unemployment rate per Province;

  • Northern Cape 7%
  • Free State        4%
  • Eastern Cape  1%
  • Mpumalanga    7%
  • Gauteng           8%
  • North West       7%
  • Western Cape  7%
  • KwaZulu Natal  4%
  • Limpopo           9%

7 million people in South Africa are employed;

6 million young South Africans have given up on looking for jobs;

According to The National Development Plan, 6 million young people faces the prospect of never securing permanent employment in their lifetime.

These bleak numbers come out in the wake of Anglo American and Lonmin announcing that they will be shedding 12000 jobs due to poor international commodity prices and the impact of “excessive” wage demands by striking workers.

Given all the above, several observations can be made:

  • South Africa’s unemployment has been hovering on 25% for a while now. (from 2000 until 2015)
  • The business model of mining houses (and other related historical industries) from inception, from the discovery of gold in Johannesburg has been built on cheap labour.
  • The continued success and sustainability of mines in South Africa depends heavily on cheap manual labour.
  • South Africa’s economy is structured around three pillars: The government, the private sector and civil service (including trade unions).

We are not going to reduce the 25% unemployment rate in the country if the status-quo remains. In fact things will get worse. We need to take radical and bold steps if we are to change unemployment in this country.

The following are some of my thoughts, I’m sure that there are plenty other ideas:

  • We need to change the structure of the economy: The economy needs to start incorporating entrepreneurship as one of the economic drivers. Partnership between the government, private sector and SMMEs is crucial. The government needs to take entrepreneurship more serious and things like paying entrepreneurs within 30 days of invoice should be norm. The private sector should consider procuring from entrepreneurs as part of the supply database as a way for development and not as a grudge purchase.
  • The business model of mining houses seriously needs to change: Mining bosses and other industry leaders needs to be ethical in their business dealings. When the business is doing well, they pay themselves hefty bonuses and consider themselves superheroes, but when the business is struggling, they blame employees for demanding huge increases, they blame the government for policy uncertainty and they blame poor international commodity prices. They blame everybody else except themselves. Its high time that they take responsibility.
  • We need visionary leadership: At the moment we lack visionary leaders both in the government and the private sector. The leaders we have are leaders who are only interested in their own narrow self interest. We need leaders who will see the bigger the picture, who will look at the best interest of the country as a whole. We need leaders who will say, in the best interest of the country and of my company, I will take a pay freeze, I will convince everyone in higher positions (who can afford it) to take a pay freeze and we will reinvest the funds in the development, creation of jobs and the sustainability of the economy.
  • Short-term pain for long term gain: If we all sacrifice now with the intention of benefiting in the future, we all win. Unfortunately we don’t have that type of selfless business and government leaders who are willing to make sacrifices, it’s everyone for himself.
  • Tax Benefits for Entrepreneurs: Those who employ more than 50 people (through the use of learnerships) should be incentivised with special tax breaks etc. Stimulating entreprenership is crucial. The government should not be the biggest employer, the private sector and SMMEs should be the biggest employers.

Instead of the government trying to create 50,000 jobs, they should focus on creating 50,000 entrepreneurs. These entrepreneurs will create more jobs.

There is a fork on the road, on the left road we continue with the status-quo which leads to the downward slippery slope of increased unemployment or we take the road on the right, where we are brave enough to bring radical changes that are needed.

Change is always better when it’s proactively planned. By the time you are forced to change due the changed circumstances, it’s too late.

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About Roche Mamabolo

Entrepreneur, Author, Dad. Passionate about Innovation and Creativity, Books, Poetry, Traveling, Theatre, Art, Music.
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