As COVID-19 impacts jobs, UIF warns that the worst is yet to come

UIF commissioner Teboho Maruping told EWN that once the COVID-19 financial relief measures dried up, workers could be in for a tough spell.

Picture: @deptoflabour/Twitter

JOHANNESBURG - With grim projections on job losses, plus growing uncertainty about the economic impact of COVID-19, the Unemployment Insurance Fund (UIF) has warned that the worst is yet to come.

After analysing data comprising of unemployment claims benefits, among other measures, the agency’s commissioner told Eyewitness News that workers could only feel the bite of job insecurity after August and September.

UIF commissioner Teboho Maruping told EWN that once the COVID-19 financial relief measures dried up, workers could be in for a tough spell.

"They're relying on TERS. When the offering from TERS ends, we're likely to see more retrenchments come end of August, beginning of September."

Recently the National Incomes Dynamics Study showed that up to three million jobs could already be lost in the country.

Unless, if using the assumption that most of these workers were not registered with the UIF, the agency’s data suggests otherwise.

In June last year a total of 212,702 retrenched workers, among others, applied for the ordinary benefit.

But over the same period this year as the country fights the effects of COVID-19, only 143,034 people applied.

REDUCED TIME BENEFITS ON THE RISE

Data compiled by the UIF shows that while there’s been a decline in ordinary unemployment benefits applications, requests for reduced time benefits have quadrupled.

This means that instead of retrenching workers, most South African employers have resorted to shortening working hours as the country navigates the dire economic impact of the COVID-19 pandemic.

In April last year, not a single South African applied for the UIF reduced time benefit, even though the country was already under great economic strain.

But in the same month this year, 4,579 people applied for the financial relief.

The UIF has remarked at how ordinary unemployment benefits claimed by retrenched people was substantially less than last year when there was no havoc caused by pandemic, suggesting employers are yet to start laying off workers en masse later in the year.

Maruping explained what the trends means.

"I think there's a trend towards reduced hours because companies are keeping people and others have used COVID-19 to take their employer-employee relationship going."

Between April and June 2019, the UIF recorded only 199 reduced time applications.

The figure for the same period this year now stands at 10,919.

Short time work means a temporary reduction in the number of ordinary hours of work owing to many reasons.

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