Economic experts have criticised Stats SA’s decision to define the 2.2 million job losses during the second quarter as economically not active people.
JOHANNESBURG – Economic experts have described the Quarterly Labour Force Survey results by Stats SA, which show that the official unemployment rate has decreased to a record low of 23.3% as confusing and they are causing an anomaly.
They have criticised Stats SA’s decision to define the 2.2 million job losses during the second quarter as economically not active people.
This is instead of adding the figure to the unemployment rate, which would have seen a steep rise in the numbers.
The entity has released the survey based on a sample of 30,000 households, leaving many puzzled as to how the country’s unemployment rate could have shrunk so dramatically between April and June.
The Quarterly Labour Force Survey has proven an old adage; that the devil is in the detail.
While Stats SA prides itself on the fact that their recorded trends are similar with others globally during the COVID-19 pandemic, economists have disputed this, saying that the decision to hold back on including the 2.2 million jobs lost in the official rate will have a devastating impact on the quality of the data going forward.
Chief economist as Investec, Annabel Bishop, said that their estimates showed that the official unemployment rate would have been well above 45% had Stats SA not classified the job losses differently.
“The outcome of the unemployment rate is misleading and indicates that unemployment has fallen in South Africa and that the employment environment has improved substantially and unfortunately, it’s not the case. We have estimated that unemployment rose.”
The expanded definition of unemployment, which includes disillusioned job seekers, is currently at 42% while there are over 26 million people who are not economically active in the country.
With close to 40 million people accounting for the country’s total working-age population, there are just over 14 million people who currently have jobs.