Grant recipients forego food to search for work

With South Africa’s economic outlook still dire, the poorest suffer deprivation and injustice while trying to support family members and find jobs that simply aren’t available.

Johannah Mahlangu’s face is etched with anxiety, the result of her daily struggle to find employment in South Africa’s battered, flagging economy.

As the head of a family of 11, Mahlangu was the breadwinner until she lost her job as a domestic worker in 2014. With no income, Mahlangu somehow stretches the R800 child support grant she gets from the state to cover her basic household needs. She also relies on this money for transport to help her find employment.

According to a Statistical Summary of Social Grants in South Africa for the period ending February 2018, there are more than 17.4 million social grant recipients, which includes 12.2 million child support grants.

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The 36-year-old mother of twins is a volunteer cook at Sovetjeza Secondary School in the small town of Matshiding in Mpumalanga. Although she is not paid, Mahlangu says volunteering at the school means she can have a meal. Sometimes it is her only meal for the day.

Mahlangu falls into the 29% of South Africans labour force-working age people- are unemployed, according to Statistics South Africa’s (Stats SA) quarterly labour force survey for the second quarter of this year. The figure increased by 1.4% from the first quarter of 2019.

Unfairly dismissed

Slouching heavily on a black couch draped in white embroidery, Mahlangu covers her face with her hand to hide the tears that are falling on to her black shirt. She talks about the agony she endured as a domestic worker for a top state official, who has yet to pay the R16 000 fine that the Commission for Conciliation, Mediation and Arbitration (CCMA) imposed for unfairly dismissing her.

Mahlangu was fired after she missed work for two weeks following a bad bus accident. “She doesn’t have compassion,” Mahlangu says of her former employer.

Mahlangu worked for her employer for six years. But the birth of her twins in 2013 meant she could no longer lodge at her employer’s house in Garsfontein, Tshwane. So she commuted from Matshiding daily. A monthly bus ticket cost R1 300.

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“The bus left at 4am and arrived in Johannesburg at 7am. In the afternoon, I got on the 6pm bus and got home at 9pm.” This gruelling commute is the reality for the 5 484 people living in rural Matshiding, 177km from Tshwane.

“My sister is the only person working. My six siblings are also unemployed,” says Mahlangu. The father of her twins died shortly after they were born.

Mahlangu spends roughly R300 a month trying to find work. “I use the money to print my CV, and I also use it for taxi fare to commute to various suburbs in Johannesburg and Pretoria to look for work.”

She says finding a job is not easy without a matric qualification. Mahlangu dropped out of high school and found work as a domestic worker at the age of 19 to help her mother fend for the family.

Negative outlook

Economist Duma Gqubule explains that the unemployment numbers look even more grim when you take into account the expanded definition of unemployment, which includes people who have given up looking for work. This category rose to 38.5% from 35% on the quarter. By this definition, 10.2 million people in South Africa are jobless and includes people who are no longer actively seeking work.

He says the labour force has grown by 650 000 people each year over the past five years. This figure includes matriculants and others who drop out of school and enter the labour market.

According to Gqubule, the economy has grown at about 1.5% a year over the past decade, while the population growth is about 0.2% a year. The outlook is bleak. “We will definitely have another downgrade by Moody’s,” he says, referring to the credit rating agency.

Gross domestic product (GDP) per capita has grown by 0.2% a year over the past decade.

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Gqubule refers to the shrinking economy, which has worsened since 2014, and says 2019 will make it five years in a row in which the country has had a declining GDP per capita. Unlike most developing countries, South Africa’s economy has never recovered from the 2008 global financial crisis. Per capita means per person, after taking into account the growth of the population.

The state needs to spend more money on the infrastructure, manufacturing and agricultural sectors to stimulate the economy, he says. “Infrastructure is usually the one that drives economic growth and job creation. That is what happened between 2004 and 2008, when the economy was growing. It created two million jobs.”

Gqubule wants the Reserve Bank to lower the interest rate during this crisis and change the way the economy is structured, so it can cater to a large workforce with “low levels of skills and education … We need to create jobs for the workforce that we have and not the workforce that we want.

“We need to introduce the right industrial policies to make incentives for people to create jobs. I think it’s very insulting to say people are unemployable. They are unemployable because of the way the economy is structured.”

Promises, but no strategy

President Cyril Ramaphosa, at a job summit in Midrand in October last year, promised to create 275 000 jobs a year. But job programmes initiated at the summit have barely managed to scrape together more than 5 000 jobs to date. 

“Government needs to create new activities in the economy and not repackage existing activities to stimulate the economy,” says Gqubule. He adds that one solution would be to keep people in higher education for longer. Currently, there are eight million people between ages 15 and 34 who are not in employment, education or training.

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Economist Vishnu Padayachee has mauled the state for failing to have a solid growth strategy post-apartheid to stimulate the economy and curb growing unemployment figures.

“We don’t really have any kind of strategy. We have the national development strategy or the national development plan, but it’s not really a plan. It’s a shopping list, there are no priorities, there is no sequencing of how to do things in the right order.”

He says the state is not only incapable of leading in terms of ideas and strategies but also lacks credible people leading some of these portfolios at ministries and institutions.

Sound strategies required

Citing Ethiopia’s growing economy, Padayachee says South Africa needs a good national development strategy backed by a sound, progressive microeconomic strategy.

“Ethiopia has had an incredible success story, growing at more than 10% a year for the last 10 years – and it is because they have political will and really capable people.”

Gqubule and Padayachee say that lowering the interest rate will have a positive effect on the economy. Padayachee also mentions the billions of rands being siphoned legally and illegally out of the country, money that could be used to stimulate the economy.

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He says the state lacks creative strategies to stimulate the economy and suggests a job guarantee scheme such as those that have worked in places like India and South America.

“All over the world, people would rather get a job than get social grants. I am not mocking social grants, if we didn’t have social grants we would be in a bigger problem. We need a minimum wage job guarantee and a much more focused social policy than a social grant system, and we may be able to generate the kind of income that is needed to stimulate the economy,” Padayachee says.

For the 10.2 million seeking employment, the economist suggests starting small businesses in non-traditional areas such as art, music and tourism to generate an income. 

Unions and the economy

Responding to Stats SA’s second-quarter survey, the South African Federation of Trade Unions urged the government to provide a R500 billion stimulus package to stop the situation from getting worse in the third and fourth quarters.

In a press statement, Saftu said it wants the government to review corporate taxes, which were around 45% during apartheid but were driven down to 28% after 1994, and personal income tax to ensure that those who can pay make more of a contribution to the fiscus.

Saftu also called for capping the salaries of those earning large amounts and introducing a meaningful national minimum wage to close the worsening income gap and address the crisis of poverty among the employed.

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United Domestic Workers of South Africa representative Pinky Langa says that although the domestic sector is not shedding jobs like the mining and other sectors hardest hit by the stale economy, discriminatory labour practices are rampant.

Some of the challenges faced by domestic workers include not being paid for overtime and the exclusion of such workers in the Compensation for Occupational Injuries and Diseases Act (Coida), which the high court in Tshwane found earlier this year to be unconstitutional.

Langa says the exclusion of domestic workers from Coida was essentially about a disregard for the value of domestic labour and the dignity and rights of workers, who are predominantly women. 

While the state struggles to deal with the unemployment crisis, Mahlangu and the millions of other people in her situation face starvation as they use their limited resources to search for employment that they hope will restore their dignity. 

Duma Gqubule is a financial journalist, analyst, adviser and consultant who founded the Centre for Economic Development and Transformation.

Vishnu Padayachee is Distinguished Professor and Derek Shrier and Cecily Cameron Chair in development economics at the School of Economic and Business Sciences at the University of the Witwatersrand.

*This article was updated to clarify statistical information.

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