Informal businesses are becoming a lifeline for millions who cannot find formal work
With South Africa’s unemployment rate climbing to 33.6%, informal businesses are becoming a lifeline for millions who cannot find formal work, but entrepreneurs say keeping those businesses alive is becoming harder as costs rise and access to finance remains limited.
Shop2Shop Chief Business Officer Annelene Dippenaar said the informal economy had become the “shock absorber” of the formal job market.
Meanwhile, Epicure Bitez founder Thabiso Mhlongo is balancing his food business with a full-time job, while Soweto tuckshop owner Given Madia is using his business to support six people at home and employ two others.
Stats SA’s latest figures show that 8.5 million people were unemployed in the second quarter, while formal-sector employment fell by 41 000. Informal-sector employment increased by 34 000, with trade recording the biggest employment gain at 70 000.
