Business in lockdown: Big shift last month, Stats SA survey shows
- A new Statistics SA survey shows a marked improvement in business activity during Level 4 of lockdown, which started on 1 May and ended a month later.
- At the end of Level 5, almost half of all businesses weren't trading - which fell to only a fifth in May.
- By the end of Level 4, 27% of businesses expected that their labour force would have to shrink - compared to 46% in Level 5.
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A new Statistics SA survey among businesses shows there was a sizeable recovery from the last two weeks of lockdown in Level 5 (14 April to 30 April), to Level 4 (the month of May).
During the final stages of Level 5, almost half of the businesses temporarily ceased trading. During Level 4 – when fast-food deliveries, and other industries were reopened - this fell to one-fifth. Only 9% of businesses were operating at full capacity during Level 5. This increased to just over one in four (26%) during Level 4.
But by the end of May, 84% of firms were still reporting turnover below their normal range.
The latest statistics from Google Mobility – which tracks cellphone location data – show that workplace commuting is still 36% below where it was before lockdown, and visits to supermarkets and pharmacies are still 20% lower.
The proportion of businesses who expected their workforce size to decline dropped from 46% to 27% by Level 4, reports Stats SA. In terms of employment, 36% of firms indicated that they had laid off staff in the short term under Level 5, reducing to 26% under Level 4.
National Treasury now estimates that job losses could be between 690,000 and 1.79 million due to the impact of Covid-19 on the SA economy. Last week, Finance Minister Tito Mboweni warned that South Africa’s economy will contract by 7.2% this year.
Under Level 5 lockdown, only 14% were confident that their businesses have the financial resources to continue operating through the pandemic, increasing to 36% under Level 4.
Under Level 5, 30% of firms indicated that they were planning to take advantage of government relief schemes. This increased to almost 40% under Level 4, possibly the result of businesses beginning to assess the full impact of the lockdown, Statistics SA reported.
More than a thousand businesses took part in the survey.
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