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This research examines the impact of macroeconomic policy options in addressing unemployment during the COVID-19 recession in South Africa.

May 24, 2026Open Access

Rethinking growth-unemployment puzzles in the COVID-19 recession: contextualising SA's macroeconomic policy options

Key Points

This research examines the impact of macroeconomic policy options in addressing unemployment during the COVID-19 recession in South Africa.
Analyzed the economic downturn experienced in South Africa in late 2019.
Evaluated the government's macroeconomic reforms and recovery plan.
Assessed the cascading effects of interventions on diverse economic sectors.
The government's reforms are unlikely to yield immediate benefits for unemployment.
Job improvements for those at the bottom of the socioeconomic pyramid will take time.
The current pandemic is creating an economic slump more severe than the Great Recession.

Abstract

The total value of goods and services produced inside South Africas borders fell steeply in the last two quarters of 2019, resulting in a sharp rise in unemployment. The governments latest macroeconomic reforms to lift the country out of the 2019 economic downturn and create sustainable jobs are unlikely to deliver immediate benefits. Interventions promised in the recovery plan will take time to cascade through complex economic sectors, agencies and diverse markets before the jobless at the bottom of the socioeconomic pyramid experience any life improvements. Meanwhile the global COVID-19 pandemic is pulling leading economies into a slump worse than the Great Recession of 2007-2009.

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