Durban - Consumer groups and economists have raised concerns that widespread job losses and the surging cost of living could lead to more political and social instability as households battle to put food on the table.
The Pietermaritzburg Economic Justice and Dignity (PMBEJD) group this week released its new Household Affordability Index in which it tracks food prices in Durban, Johannesburg, Cape Town, Pietermaritzburg and Springbok.
In light of double-digit price hikes and high electricity and transport costs, it called for the government to extend its Covid-19 social relief of distress grants to ameliorate the impact of surging prices.
According to Statistics SA’s latest labour force survey released this week, about 2.2 million jobs were shed in the second quarter of 2020, a reality economists and consumer groups have warned could lead to social and political unrest as people battle to beat the rising cost of living.
According to the survey, the average cost of the Household Food Basket across regions was R3 783.16 in September 2020, making it out of reach for many earning the national minimum wage of R3 487.68. Its Pietermaritzburg-based data calculated transport to work and back and electricity costs as taking up more than half of the wage at 54.7% or R1 907.50.
“Families will have to make up the income shortfall through cutting back on their food consumption or finding additional income or credit, but even if they are able to do this, underspending on food will still occur, and health, well-being, nutrition, and productivity will be negatively affected,” PMBEJD said.
According to the survey, the cost of the Pietermaritzburg Household Food Basket increased by 7.2% (R232.62) over the past six months of lockdown from March 2020 to September 2020, and it increased by 10.4% (R326.41) year-on-year in September 2020. The total cost of the basket in September was R3 453.62.
Lullu Krugel, chief economist for PwC Africa Strategy, said that according to the group’s identified global mega-trends, if unemployment is not addressed, societies may face increasing social unrest.
“This rising social and political unrest is already manifesting in South Africa. Following strict movement controls in April and May, protest and other related action increased across the country as lockdown regulations eased,” Krugel said.