South Africa is in a technical recession and this is what it means for young South Africans.
What is a Technical Recession
According to the Conversation, a technical recession is when an economy suffers two consecutive quarters of negative economic performance. It refers to shrinking economic output, sometimes also known as negative economic growth or economic decline. In short, it implies that the economic activity of a country is declining.
But what does that mean for young South Africans especially those affected by unemployment?
According to StatsSA South Africa’s unemployment rate is high for both youth and adults; however, the unemployment rate among young people aged 15–34 is 38,2%, implying that more than one in every three young people in the labour force did not have a job in the first quarter of the year 2018.
What the Economist says
We spoke to private economist Professor Bonke Dumisa about the effects the technical recession would have on the youth of South Africa.
He said the technical recession would affect people differently but would definitely affect everyone somehow.
“The youth will be affected directly because of the unemployment rate which will worsen if the different sectors continue to underperform,” he said.
Dumisa said the agriculture, transport, and hospitality sectors were doing badly which would affect the youth that is already in those sectors and those still interested in joining them.
“The direct impact on the youth depends mostly on how many of the youth are already in these sectors, in agriculture, there are not a lot of young people but the hospitality and transport sector there are,” he said.
He added that with hospitality all the young people who would work for companies over their vacations for extra money would probably no longer be able to do that because the industry won’t be able to afford them.
Dumisa said as the recession continues companies will start retrenching which he felt would affect the youth directly.
“Companies follow the policy of last in first out, and in most cases, the youth are the ones who suffer the most from that,” he said.
What youth say
Nkululeko Ndlovu who has been leading the unemployed graduate’s marches against unemployment in Durban said he felt the recession would only make matters worse for the unemployed youth of South Africa.
“The unemployment rate will rise, crime will rise and companies will retrench people. The situation is very frustrating,” he said.
He felt that the government had to now come up with new strategies to help the country move forward.
“The job of the government is to restore hope in people so they must step up now and lead the people in the right direction,” he said.
