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Johannesburg - The economic crisis has resulted in a massacre among small businesses, the drivers of job creation.
Labour cuts have increased dramatically since May last year and more than 4 899 companies retrenched employees in the year to January.
These are among the alarming figures Professor Haroon Bhorat, one of the country's foremost labour economists, has produced on the effect of the recession on the labour market. It also seems that training budgets in smaller companies have been completely suspended and spending is strictly reserved for core business operations.
The number of companies cutting jobs in the financial sector has risen by 52% and those in the retail sector 34%.
He is particularly concerned about the possible loss of skills in the retrenchment process.
More than half of the company liquidations in the past year involved small firms. This was particularly bad in the building industry, where 85% of liquidations were of small businesses, and in the financial sector 43% were of small firms.
In the five years preceding the crisis the economy had reversed the 1990s' rising unemployment trend. An average growth rate of 4% a year from 2000 had risen by an average 2.5 annual increase in employment.
"Lower growth rates and their effect on the future long-term prospects for hiring are extremely concerning," Bhorat declared.
- Sake24.com
For more business news in Afrikaans, go to Sake24.com.