South African companies have announced plans to cut more than 10 000 jobs less than three months into 2020 as faltering economic growth adds strain in a country where a third of the workforce is unemployed.
Electronics company Ellies Holdings is the latest to start the process of reducing its headcount due to ongoing financial losses. Jobs are also at risk at companies including Telkom and Massmart after slumps in earnings.
If realised, these job losses will add to an unemployment rate that is at the highest in at least 11 years, and place a further dampener on an economy stuck in the longest downward cycle since World War 2.
Annualised GDP data to be released on Tuesday will probably show South Africa fell into a second recession in consecutive years after Eskom implemented the deepest electricity cuts yet in December.
The economy likely contracted by 0.2% in the final three months of 2019, according to the median estimate of economists in a Bloomberg survey. That may have dragged down economic growth for the full year to the slowest in a decade. — Reported by Prinesha Naidoo, with assistance from Jacqueline Mackenzie and Rene Vollgraaff, (c) 2020 Bloomberg LP