SEIFSA ANNUAL REVIEW 2021
CHIEF EXECUTIVE OFFICER’S REPORT
ANOTHER TOUGH AND CHALLENGING YEAR
The year under review has been the most difficult, not just in SEIFSA’s recent history, but also for the South African economy and, indeed, the global economy. In the space of a year, the true cost of the COVID-19 pandemic and the ongoing lockdowns introduced by the government to help contain its spread have had a devastating effect on the economy. The ongoing restrictions matched against a fragile economy and spiking unemployment have severely impacted the Metals and Engineering (M&E) Sector at a time when the economy was already in the doldrums due to the high unemployment rate and increasing inequality. Fourth-quarter economic growth data for the period under review, showed that the economy grew at a seasonally adjusted and annualised 6.3%, which was not enough to offset the expected slump in fullyear GDP, which contracted by a massive 7% in 2020 – the biggest contraction since official records began in 1946 – that’s the worst slump in 75 years.
The negative growth figure for 2020 as a whole demonstrates how much economic ground was lost last year in terms of widespread business failures and huge job losses – MIBFA alone recorded 16,623 jobs lost in the period between April and December 2020 with a further 4,957 jobs being lost between January to the end of March 2021. This trend has continued with a further 2,625 jobs being lost between the end of March to May 2021, all adding up to 24,205 jobs having been lost between April 2020 to the end of May 2021. The economy, which is battling record unemployment and continued business failures, is only projected to recover from the negative effects of the global COVID-19 pandemic at best from 2022 and realistically from 2023 and 2024 onwards. The pandemic and the resultant lockdowns have had a devastating impact on the economy, adding to job losses and leading to a spike in the unemployment rate that now stands at a record 32,6% – or, if one had to use the expanded definition of unemployment (i.e., those eligible to work but who have given up looking for job opportunities), the number surely would be in
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