The latest Misery Index from the Cato Institute shows that South Africa is one of the most miserable countries in the world.
In its 2015/16 rankings, South Africa ranked as the 5th most miserable country in the world with a score of 40.0, up from 10th position in 2014/15, when it had a score of 39.2.
The misery index is based on four key data points: Unemployment levels, interest rates, consumer prices and economic growth.
Like other countries in the top 10, South Africa performed poorly across all indicators – but its unemployment rate is what hits the hardest.
The country’s key misery indicator is the rate of unemployment, which jumped a relatively massive 2.2 percentage points to 26.7% in Q1 2016, Stats SA reported this week.
According to the Cato Institute, South Africa’s unemployment crisis is worse than it was at the end of apartheid in 1994 – and the story is most alarming for youth unemployment, which tops 60% when ‘discouraged workers’ are added in.
This view echos a similar report put out by the World Bank in January 2016, which said that the country’s education system appears to have left the young unemployed and ill equipped for a labor market that demands more skills.
In the first quarter of 2016, the South African job market suffered 355,000 job losses – the bulk of which were in the trade, manufacturing and construction sectors.
“Insufficient job creation has left South Africa’s unskilled or semi-skilled and its youth facing the prospect of long-term joblessness, and they appear ill equipped for a labor market that demands higher skills,” the World Bank said.
More job-intensive growth would help tackle unemployment and create jobs for many new labor-force entrants in the coming 15 years, allowing South Africa to take the first step in harnessing its favorable demographics, the report said.
“But simply increasing the number of jobs will not be enough to allow South Africa to boost savings and derive the second demographic dividend. More job-intensive growth needs to be accompanied as a first priority by improving the quality of education so that better educated youth are entering the workforce,” it said.
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Source: Business Tech