Unemployment is not a private sector fix and this is a government problem to inject money back into the economy in order to fuel economy growth which then ignites job creation. When you are clueless and uneducated this pathway is not so obvious.
A recent study has highlighted how bad the South African economy really is if you are someone seeking employment. The evidence is clear every single day when driving around especially in certain areas where the unemployed hang around hoping for some casual work. There are certain street corners where one can go if you need casual staff for the day which we use their services to off load containers.
The numbers over the years have swelled to the extent that it is no longer 5 or 6 people hoping to be picked up for a days work and is more in the 50-150 range. When you arrive looking for 4 people it becomes a bun fight as everyone is so desperate to be selected and there is no formal line that makes it a first come first serve situation.
Things are so bad here currently that finding work during the 1930 Great Depression was easier than what is happening now in South Africa. Researchers have calculated that roughly 131K new jobs were created over the last decade whilst unemployment has risen from 8 million to 12 million people.
What is more depressing is these figures are not the real figures which are much higher due to the hidden unemployment figures. During the Great Depression in the US unemployment figures hovered between 20 and 25 percent where as SA's figures are in the region of 50-60% which is the realistic figures and not the manipulated figures.
The recent official unemployment stats have unemployment rising by 1.7% during the first quarter of this year which equates to around 300K. What is crystal clear is that this unemployment problem is not something that can be fixed over night. Reports suggest that the formal economy would need to double or triple in order to solve the unemployment issues.
The best case scenarios will see people unemployed for their entire lifetime which is a sad reality that no one should ever face. The young generation is where the problem lies as we know this age group is where the bulk of the unemployment is found. Another scary stat is that if the economy grew at 3% year on year adding 5% jobs every year then it would take somewhere between 20 and 25 years to fix.
When you have many millions excluded for participating in the economy one has to see them as wasteful public resources. The government could fix this problem very quickly if they ditched their corruption and concentrated on fixing the country. Millions could be employed fixing the broken infrastructure which in turn would boost the flow of money back into the economy which has been the lacking ingredient. When the tax money is not returned to the economy it tends to stagnate and shrink which is what has happened here.
This problem has been ongoing for may years and back in 2018 I mentioned the country felt like it was in a depression because the lack of money flowing from the top. The tax revenue was being looted and funneled out the country and has been doing so for decades. Getting people back to work requires government spending as this is the basic formula of how this works and you cannot rely on the privates sector to do this. An absent corrupt government has created this problem and will continue to deteriorate until there is political change that has a plan to offer solutions that does not involve themselves lining their pockets.
Posted Using INLEO
