[Opinion] SA’s emerging demographic crisis: dependency on the rise

The country’s dependency ratio – the number of people not working for every 100 who have jobs – has risen from 250 to 275 in a decade. This emerges from an analysis of the latest Quarterly Labour Force Survey.

A Macro Review report published by the Centre for Risk Analysis shows that the country has failed to take full advantage of its youthful population, which is one factor in the rising dependency ratio.

Favourable age distribution

The report, South Africa’s demographic dividend remains elusive, indicates that 59.1% of the population is aged 34 years or younger, which means the country has a highly favourable age distribution profile: enough people of working age to support the non-working population.

Despite this favourable demographic profile, however, millions of people have been unable to find a job.

The current policy status quo in South Africa, along with the government’s deteriorating relations with key trading partners, risks exacerbating the unemployment crisis.

To significantly improve employment prospects for South Africans, the Government of National Unity will have to implement key policy reforms that will lift the economic growth rate above the current average of 1%, which is lower than the population growth rate.

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In addition, the government needs to improve trading relations with the United States, as well as upgrade the country’s trade infrastructure.

If these steps are not taken, South Africa’s employed population will shrink further, while the population of dependants will grow.

Article originally appeared here.