PRETORIA, South Africa, Jun 23 – South Africa’s unemployment rate rose one percentage point to 30.1 percent in the first quarter of this year compared with the last three months of 2019, official data showed Tuesday.
The new data is a far cry from what analysts expect to be the ultimate fallout from the coronavirus which has infected more than 100,000 people in Africa’s most developed economy.
The number of unemployed came to 7.1 million, with the formal sector shedding the most jobs, StatsSA said.
“Most industries experienced job losses in the first quarter of 2020, compared to the fourth quarter of 2019,” the statistics agency said, adding that the finance sector lost 50,000 jobs.
President Cyril Ramaphosa on Monday warned of mass job losses and “tough times” ahead as the continent’s most industrialised country braces for the economic fallout from its strict anti-coronavirus measures.
Ramaphosa imposed a strict lockdown on March 27 to try to limit the spread of COVID-19 and prepare hospitals for an expected surge in cases.
But the move has cost the economy dearly. South Africa was already in recession when the virus arrived.
The central bank now forecasts the economy will shrink seven percent in 2020 as it buckles under the coronavirus pandemic.
Since last month the government has started loosening the lockdown to enable business activity to resume gradually.
“For a country such as ours, which was already facing an unemployment crisis and weak economic growth, difficult decisions and difficult days lie ahead,” Ramaphosa said in his weekly newsletter.
Companies, including the public broadcaster SABC, last week announced plans to lay off staff.
The South African Chamber of Commerce and Industry has warned that the unemployment rate could rise as high as 50 percent because of the pandemic.