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Cape Town - Self-employment is at the highest level since 2009 with 1.2 million self-employed business people, Absa Group [JSE:ASA] has announced in an index on Monday.
The Absa SME Index for South Africa rose by 1.4 index points to 93.4 in the second quarter of 2012, boosted by growth in self-employment.
The index showed an improvement on self-employment with a growth of 1.1% over the last quarter of 2012 and overall 2% growth over the last year.
Economist Mike Schüssler, who works on the index, said the number of self-employed on index is 1 253 000 or about 10% of all employed adults.
"With nine out of the last 10 quarters indicating growth in self-employment it is likely that the longer term trend may now be upwards", he added.
SA had 707 000 employers during the fourth quarter of 2012.
Schüssler said that employer numbers had a year-on-year decline of 2.1% in 2012 but the last quarter saw a slightly smaller decline of 0.2%.
The effects of the worldwide economic crisis on self-employment has waned, but some smaller effects still remain, he cautioned, given that the figure was still 2.5% below its recent highs.
Schüssler also said that a tax breather would be a great advantage for small and medium enterprises (SMEs).
“The growth in self-employment shows that SMEs are also benefiting from low interest rates and would also benefit in future if tax relief for them was introduced as this could be positive for business formation and sustainability.”
The index data is based on various economic indicators gathered from Statistics South Africa, said Sisa Ntshona, head of enterprise development at Absa.
Ntshona said the index is crucial for policy makers regarding SME development, high unemployment and job creation.
The Absa SME Index for South Africa rose by 1.4 index points to 93.4 in the second quarter of 2012, boosted by growth in self-employment.
The index showed an improvement on self-employment with a growth of 1.1% over the last quarter of 2012 and overall 2% growth over the last year.
Economist Mike Schüssler, who works on the index, said the number of self-employed on index is 1 253 000 or about 10% of all employed adults.
"With nine out of the last 10 quarters indicating growth in self-employment it is likely that the longer term trend may now be upwards", he added.
SA had 707 000 employers during the fourth quarter of 2012.
Schüssler said that employer numbers had a year-on-year decline of 2.1% in 2012 but the last quarter saw a slightly smaller decline of 0.2%.
The effects of the worldwide economic crisis on self-employment has waned, but some smaller effects still remain, he cautioned, given that the figure was still 2.5% below its recent highs.
Schüssler also said that a tax breather would be a great advantage for small and medium enterprises (SMEs).
“The growth in self-employment shows that SMEs are also benefiting from low interest rates and would also benefit in future if tax relief for them was introduced as this could be positive for business formation and sustainability.”
The index data is based on various economic indicators gathered from Statistics South Africa, said Sisa Ntshona, head of enterprise development at Absa.
Ntshona said the index is crucial for policy makers regarding SME development, high unemployment and job creation.
Click here for a graph indicating the growth rate of self-employed business people in South Africa since 2008.
- Fin24
