The coronavirus lockdown could slash more than a million jobs, Efficient Group economist Dawie Roodt has told an online press conference held by the Institute of Race Relations (IRR).
Working off projection models based on previous periods of steep contraction, he said his findings showed that the local economy could contract by up to 6% over the course of the year.
“Growth in the 3rd quarter will be very flat, if we’re lucky. And with a bit of luck we could be out of the recession by the end of the year.”
Roodt also mentioned that economic analysis from other sources predicted a much steeper contraction, namely 10%.
“If that’s the case we could lose up to a million jobs. In fact, gathering from previous experience, it would be slightly higher, more like a 1.1 million jobs.”
It means, he emphasised, that around 11 million South Africans will soon find themselves unemployed.
Roodt also questioned the Reserve Bank’s estimation that around 1600 companies could fold because of the effect the pandemic is having on the local economy.
“I don’t know where they’re getting that from.”
He said if you considered the projections at this stage, that figure could be a lot higher.
“Many, many thousands of businesses will be closing down.”
All the more reason, Roodt said, that the lockdown in South Africa should be ended as soon as possible.
“We need to open this economy so we can create jobs.”
