The Economy and Unemployment Under Covid-19: A Review of The South African Government’s Response

• Pages: 140-150
• Date: 01 December 2021
• Published date: 01 December 2021
• Author: Hulisani Takalani,Pandelani Harry Munzhedzi
• Subject Matter: Derecho Público y Administrativo

Special Issue

December, 2021

European Journal of Economics, Law and Social Sciences

IIPCCL Publishing, Graz-Austria

ISSN 2519-1284

Acces online at www.iipccl.org

170

The Economy and Unemployment Under Covid-19: A Review of The South

African Government’s Response

Hulisani Takalani

Pandelani Harry Munzhedzi

University of Venda

Abstract

The World Bank Group’s 13th edition of the South Africa Economic Update (SAEU) and the

Statistics South Africa concur that COVID-19 pandemic worsened the country’s economic

trajectory which was already experiencing low levels of employment. South Africa’s level

of employment and economic status were far below the standard of most middle-income

countries even before the pandemic. The high unemployment rate has been aributed to a

decade characterised by weak job creation strategies. The report from SAEU also f‌inds that the

job market was severely aected and that recovery has been slow despite the government’s

prompt response to the pandemic. This paper seeks to explore the eects of COVID-19 on

the job market economy. The paper further seeks to review the south African government’s

eorts in mitigating the economic impacts of the pandemic and resulting unemployment hike.

Using existing literature and relevant reports, the paper argues that South Africa’s overall

economic response to the pandemic was insucient particularly in the labour market despite

the many sizable social and economic relief measures. Furthermore, the paper provides

recommendations on how the South African government can improve its eorts in dealing with

both the immediate and long term impact of COVID-19 on the economy and unemployment.

It is recommended that greater support for small businesses should be introduced as well as

oering tax rebates to businesses creating labour intensive jobs.

Key words: Economy, employment, COVID-19, labour market, job creation.

Introduction

The coronavirus disease of 2019 otherwise commonly known as COVID-19 originated

in Wuhan City in China before it spread all over world and later declared as a

pandemic by the World Health Organization (WHO). The pandemic has since poses

a mammoth encounter to South Africa and many other countries of the world in as

far as the management of the pandemic is concerned (Munzhedzi & Phago, 2020;

WHO, 2020). The pandemic which is being managed dierently from one country

depending on the strength, capacity and principles of that country. The eect of the

pandemic all over the globe has been massive in that almost all sectors of society

are impacted. Even worse is that many countries including South Africa imposed

lockdown at some point on international and local travel based on their lockdown

regulations and guidelines (Dong, Hu & Gao 2020). Bhorat, Oosthuizen and Stanwix

(2020) posit that softening the impact of the COVID-19 lockdown on the working

poor and low income earners who are unlikely to have safety nets and protection