Statistics South Africa (StatsSA) released its latest figures on Monday, specifically looking at how many companies and businesses have been liquidated in the last year.
According to the data, SA experienced more than 1,600 liquidations in 2023.
While not the best news, the number of companies that have closed or failed has dropped when compared to 2022.
StatsSA notes that liquidations decreased by 13,1% in 2023 compared with 2022.
Liquidations of companies decreased by 15,6% (from 1,091 to 921) and liquidations of close corporations decreased by 9,8%(from 816 to 736).
The total number of liquidations decreased by 13,5% in the fourth quarter of 2023 compared with the fourth quarter of 2022. There was a year-on-year decrease of 13,8% in December 2023.
What industries were hit the hardest? According to the data, the financing, insurance, real estate, and business services sectors were hit hard and 554 businesses were forced to close in 2023.
The trade, catering and accommodation industries were the next sectors that were impacted and where businesses were liquidated. In these sectors, a total of 318 businesses were closed in 2023.
According to the data, the community, social and personal services sector in SA lost 130 businesses in 2023.
These liquidations will no doubt have a major impact on unemployment in South Africa.
However, it should be noted that SA is on a growth trajectory when it comes to combating unemployment.
In December, the latest Quarterly Labour Force Survey (QLFS) by StatsSA showed that the unemployment rate decreased to its lowest level in a year in the third quarter, falling to 31.9% from 32.6% in the previous quarter.
This means that a total of 979,000 jobs were created.
South African still has huge unemployment figures. The country has the world's second highest unemployment rate, with roughly eight million individuals of working age being unemployed, according to the International Monetary Fund.
Saifaddin Galal, a research expert at Statista said that SA expected to register the highest unemployment rate in Africa in 2024, with around 30% of the country's labour force being unemployed.
CULL PRIOR WORK EXPERIENCE
Ramaphosa said that he hoped such an action would lead to more youth being employed in South Africa and that this would boost employability and reduce massive unemployment.
“As government, we have made the call for businesses to invest in our nation's future by employing more young people and, where possible, to do away with the requirement of prior work experience,” Ramaphosa said in a statement.