The Kantar Mzansi Consumer Barometer 2024 shows that the outcome of this year’s general election is a cause of concern for about 17% of respondents, with 12% worried about the possibility of crime and violence connected to the election.
Rolling blackouts
Rolling blackouts have topped the list of concerns for the last four years.
Stacy Saggers, the commercial growth director at Kantar, said she had stocked up on gas because she believed that as soon as the election was over, rolling blackouts would return.
According to The Outlier and the Eskom se Push app, by Monday, SA had experienced 54 days without rolling blackouts. The last time the country had such a long period of uninterrupted electricity was between 5 December 2021 and 2 February 2022.
https://www.youtube.com/watch?v=9dFRaWprTW0&feature=youtu.be
Last week, Eskom said its generation operational recovery plan was the reason for the improvement in the reliability of the generation fleet, with a focus on accelerating and executing planned maintenance, online preventative maintenance, major plant refurbishment and life extension projects. A total of 3,900MW of generating capacity was due to come back into service on Monday.
In an energy action plan update on Monday, Energy Minister Kgosientsho Ramokgopa said the energy availability factor (EAF), a measure of how much of Eskom’s generation capacity is operational, had risen to 60.5% year-to-date, up from 51.7% in the same period last year.
Unemployment
According to Stats SA, total employment figures dropped by 194,000 in the fourth quarter of last year, from the third quarter. Jobs were lost in various sectors including community services, construction, business services, manufacturing and mining.
South Africa has the highest unemployment rate in the world at 32.1%. The Quarterly Labour Force Survey for the first quarter of this year showed that the number of unemployed people ballooned to 8.2 million from 7.9 million in the last quarter of last year. This means more than 300,000 became unemployed between the fourth quarter of 2023 and the first quarter of 2024.
However, as Nedbank’s chief economist, Nicky Weimar, pointed out, one has to bear in mind that the labour force grew by 352,000 in the first quarter of the year when new graduates and school leavers entered the job market. “Discouraged workers also usually return to the market at the start of the year with hopes of finding a job,” he said.
Weimar said the outlook for the job market remained poor.
“Employment in the services industries will likely stagnate as restrictive monetary policy continues to weigh on domestic demand, hurting confidence, making consumers wary of spending and companies unwilling to undertake fixed investment.
“At the same time, public sector employment will continue to be restricted by government caps on staff numbers to support necessary fiscal consolidation.
“While structural constraints have eased since the start of the year, with reduced load shedding and improved transport services, most producers and exporters will probably focus on restoring their profit margins badly depleted by the severe disruptions and surge in operating costs last year. Consequently, we expect job creation to remain weak in 2024,” he said.
Crime and violence
Contact crime was up by 7% year-on-year in 2023. Police Minister Bheki Cele was due to release the fourth-quarter crime statistics for 2023 on 18 May but failed to do so. Over the last year:
- Murders increased by 11.5% between the first and second quarters (from 6,228 to 6,945) and by another 11% to 7,710 murders in the third quarter.
- Attempted murders climbed by 15.8% between the first two quarters and then again by 16.1% between the second and third quarters of last year.
- Almost 3,000 more people were raped between October and December 2023 than between April and June 2023.
A World Bank report in December said rampant crime was adversely affecting South Africa’s economy.
“Reducing the homicide [murder] rate, which has been increasing over the past decade and stands among the highest in the world, could be a priority to improve the perception of insecurity in South Africa and improve confidence.
“Tackling the rise in organised crime, which has thrived on the declining capacity of the police and justice institutions and has broad-based effects on economic activity, could be another priority,” the report said.
Corruption
Saggers said corruption was the bane of South African society. The 2023 Corruption Perceptions Index released by the anti-corruption movement Transparency International revealed that South Africa had achieved its lowest-ever score of 41 points out of a possible 100.
“The scale moves from zero to 100, where zero would be absolute anarchy and 100 would indicate a very democratic and non-corrupt government. At 41, South Africa is really very low within that scale of corruption,” she said.
Businessman Patrice Motsepe told France24 last month: “I think one of the biggest problems in South Africa and in other parts of the world is corruption.” He added, “When you take action against some of the big names … you send a message that indeed, nobody is above the law".
Cost-of-living crisis
Consumer inflation accelerated in February, moving to 5.6% from 5.3% in January. Inflation data for March will be released later this week.
South Africans have seen big jumps in the cost of electricity and water over the last year, while the cost of basic food products such as meat and eggs has also risen significantly. The Pietermaritzburg Economic Justice & Dignity Group said higher vegetable prices, particularly onions, drove up the price of the April household food basket.
According to the DebtBusters’ latest Debt Index for the first quarter of this year, persistently high interest rates and inflation, as well as stagnant salaries due to a lack of economic growth continued to erode consumers’ disposable income — with the impact of increased interest rates on asset-linked debt particularly evident in the 40+ age category.
The report highlighted how higher-income earners were using credit to offset the dual impact of inflation and interest rates. The debt-to-income ratio for people taking home more than R35,000 per month was 172% in Q1, while their unsecured debt levels were 41% higher than the same period in 2016, when DebtBusters first began analysing the data. DM