More lost jobs under Covid-19 lockdowns hit UIF and the economy hard.
The Unemployment Insurance Fund (UIF) says that 578 677 of workers who from the Temporary Employment Relief Scheme (TERS) during lockdown have now lost their jobs, increasing the already high number of unemployed individuals.
UIF spokesperson Makhosonke Buthelezi said that the massive job losses were having a heavy impact on the country’s economy. He explained that when companies close down or have to retrench workers, a substantial knock-on effect, which includes a reduction in tax revenue collection, occurs. This, in turn, affects the fund’s revenue, with contributions declining at a time when claims are increasing.
Makhosonke said that the fund paid 1 787 268 beneficiaries more than R10 billion between 26 March 2020 and 19 January 2021. However, reports from the CCMA show that this has increased by 40 percent, and therefore the UIF is expecting an increase in the claims for unemployment benefits.
In September, Statistics South Africa’s quarterly labour force survey showed that 2.2 million more people had lost their jobs in the second quarter of 2020.
In light of the massive job losses, trade union federation Fedusa has called for a freeze on all retrenchments and future potential processes, saying it believed that all possible avenues should be considered “instead of continuously using workers as scapegoats”.
Fedusa general secretary Riefdah Ajam said the SA Reserve Bank (SARB) needs to assist workers entrapped in debt due to the lockdown.
