According to Statistics South Africa’s most recent quarterly labour force survey, there were almost three million workers in the informal sector at the end of 2019. (Delwyn Verasamy/M&G)
The experiences of containing the spread of Covid-19 has posed both obstacles and opportunities for the formal and informal sectors of South Africa’s economy. Some have had the good fortune of navigating and manoeuvring successfully through the pandemic, but others are sinking.
The Covid-19 lockdown has negatively affected children who are informal traders. Child traders have not been able to sell their wares, and the meagre income they used to get has meant devastation for them and their families.
In the Mapungubwe Institute for Strategic Reflection’s book, Beyond Tenderpreneurship: Rethinking Black Business and Economic Empowerment, it is argued that the informal sector has to be better understood so that economic empowerment policies can be designed for it. The publication further argues that the opportunities that this economy has for entrepreneurship and employment could expand economic participation and emerging policies should not impose formal sector regulatory mechanisms in the informal business context. South Africa needs to re-look at informal trading and come up with policies that aim at alleviating the plight of child traders.
The legal working age in South Africa is 15 and, according to Statistics South Africa’s Survey of employed and the self-employed 2013, informal traders aged 15-24 account for 4.9% of the informal sector in South Africa. This makes child informal traders aged 15-17, in particular, one of the most vital working-age populations. Their contribution to the economy, however, remains largely unexplored which makes them vulnerable.
Thousands of children are forced to become traders to escape poverty and sustain their families. In 2013, more than a third of children were living below the Food Poverty Line (FPL) of R441 per month. This means that 33.3% of children cannot afford to buy a basket of food that costs R441 at 2020 prices. These children also live in homes where there is no working adult.
Research conducted by Wilson Mabasa (2015): The impact of informal traders on the economic development of Limpopo, found that that province has one of the largest informal sectors in South Africa. I have also personally observed this in the village I grew up in, Turfloop, near Polokwane. There are plenty of children going from door to door, selling different things in order to survive.
One of them is 19-year-old Lesedi*, who started selling fried fish wrapped in newspaper for R7 a portion, from the age of 12. Growing up in a female-headed household, with an unemployed mother, three other siblings, and her own two children, social grants and selling fish are the only sources of income for her family.
Every day after school, from about 3pm to 6pm, she would go around the streets selling and soon earned the nickname “Fish”. On a good day, especially after pay-days, Lesedi would make about R350 and on bad days, she’d make about R70, bringing in roughly R4 000 a month. Selling fish meant she could avoid using up her children’s social grants.
Since the Covid-19 lockdown, this system has drastically changed. Neighbours are not buying from child traders because they fear contracting Covid-19. There is also growing apprehension of meeting police officers on the streets, so most traders do not even come out to sell.
To make the situation worse, Lesedi does not qualify for a trading permit — since she sells hot, cooked food door-to-door — or unemployment relief. All that she receives from the government’s R500-billion relief package is the South Africa Social Security Agency (SASSA) grant for her two children. The threat of hunger is looming, although the increased grants and food parcels do all help somewhat.
It stands to reason that informal child traders have a wealth of trading knowledge that should be harnessed and nurtured. The government should mobilise these young entrepreneurs, support and encourage them to succeed and inspire others to do the same.
The department of small business development should also provide training and skills that will enable these young entrepreneurs to grow from being survivalists to being self-employed.
*Not her real name
Keabetswe Mogosoane is a political economy research intern at the Mapungubwe Institute for Strategic Reflections. She holds a BA communication degree and BA honours in political studies from North West University