It’s a catastrophe, Mr President

As the government enforces strict lockdown measures which will, in theory, help the medical sector cope with the Covid-19 tsunami, there can be few who think the restrictions are not going to severely damage our economy.

Yet, many may be underestimating the impact the lockdown is having on the poor and the middle class – those who provide the muscle to power the economy. Results from the 2020 Covid-19 special report of Old Mutual Savings and Investment Monitor are frightening.

Seven out of every 10 households are earning less than they did before the coronavirus crisis, ranging from slight reductions to no one in the household earning anything. That latter situation is in line with the grim reality of three million jobs being lost between February and April.

Workers in the low-income bracket – earning between R5,000 and R10,000 a month – have been hard hit, with four out of 10 reporting that their incomes had dropped by between half and 75%. People older than 50 are badly affected, with 63% saying their financial situation has got worse.

In total, 48% of consumers believe they are worse off financially than last year … but this number is higher among low-income earners (54%). Just one in three South Africans believe they are doing “all right” or that they are “comfortable”.

We have moved well beyond disaster and are now in the middle of a full-blown catastrophe. And what do we get? We get platitudes from our president, who says now is the time to rebuild the economy.

How are we going to do that, Comrade Ramaphosa, when large chunks of the economy are still locked down and people can’t work? People are dying – and it’s not from Covid-19.

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