Yvonne Mogotlane is desperate. She has three children to feed and is out of work. The 42-year-old mother of three is a migrant worker, who was forced to leave her children in Lephalale and travel to Johannesburg to find work. She managed to secure a job as a domestic worker. For eight months she worked for the Van Wyk* family, who offered her lodgings as part of her agreement for them. But her employer lost his job as a sales rep for a firm that supplies office equipment and he could not afford to keep her on. To make matters worse, the Van Wyks defaulted on their bond repayments. They have been forced to sell their house, and Mogotlane may find herself out on the streets soon.
“I am trying to find another job, but it is difficult. People are struggling to pay their house and their car, and they don't have money to give people jobs,” says Mogotlane. “I have three kids to feed. They are staying back home with my sister. If I don't have a job who will feed my kids? “These times are hard.”
Respected property economist and Wits University professor Francois Viruly says the middle class, which had fuelled economic growth and job creation in recent years, is the most vulnerable. “This sector went into too much debt and that has put them under immense pressure.”
The Van Wyks aren't the only people taking strain. According to The Knowledge Factory, which compiles the SA Property Transfer Guide, there has been a staggering 323% increase in home repossessions between 2007 and 2008. About 6,000 cars and 2,000 homes are being repossessed every month. Alliance Group, one of the country’s biggest auction houses, has sold residential property worth more than R7-billion since July last year.Ben van Wyk*, Mogotlane's employer, says he is sad to let her go. “We just couldn't afford to keep Yvonne any more, and we have nowhere for her to live. With me being out of a job, we've lost the house and the cars. We are moving in with my in-laws at the end of the month, until we can get back on our feet. At this point we are in such a bad position that we can't help ourselves, let alone anyone else.”
The Times reports that since April last year, household debt – which includes bond, overdraft and credit card payments – has rocketed from R952-billion to over the R1.1-trillion mark. Household income sits at R1.4-trillion. More than 7.1 million South Africans, out of a population of 17.5-million credit-active people, have “impaired” credit records. More than 500,000 cash-strapped South Africans have been forced into debt counselling to try to claw their way out of crippling financial predicaments.Mogotlane has bought herself a bit more time to find another job. “I can stay with a friend for a few weeks but her place is very small and I can't stay there forever. If I can't find another job I don't know what I am going to do. There are no jobs back home and I am supporting my sister and her kids and my kids.”
Joseph Masipa has had a good day. He is a jack-of-all-trades and sits at the corner of a busy intersection waiting for “piece work”. Every now and again he gets lucky, and someone who needs a labourer for the day stops to pick him up. “I can do any thing – painting, gardening, building. But the last few months have been very slow. Not many people are stopping.” Today, he struck gold. Someone he has worked for before has given him the job of painting his house.Masipa doesn't charge a fixed rate for his services. He takes what he can get. “Maybe April, May, I was getting R80 a day for jobs. People were coming here because they needed a builder, maybe they were doing a construction on their house and they needed an extra worker. Now I'm lucky if I get paid R60 a day. People they don't have money. Nobody is building on their house any more.”
Builders across the country are taking strain as South Africa is now being hit by the full force of the global recession. President Jacob Zuma last month confirmed that the retail, financial, mining and construction sectors were the worst affected
Masipa lives in a nearby squatter camp with his wife and two children. He is starting to get desperate for a more permanent job. “Some days I sit here for nothing. I pay the taxi fee to come here and go home but I can't get work.” To make matters worse, a group of equally-desperate men have joined him on the corner, and if there is work, it is a case of whoever can jump on the back of the bakkie first gets the job.
Despite all the doom and gloom, consumers could be seeing the first signs of a recovery, says Goolam Ballim, Standard Bank's chief economist. He adds that, although consumers remained stressed, the 4.5 basis points interest rate decline since December would start giving consumers extra purchasing power. “The degree of pain for consumers would seem to be easing,” he says.
* Names have been changed to protect their identity.
