By Dr Imraan Buccus
South Africa is facing a devastating unemployment crisis that is both deepening poverty and perpetuating inequality. The official unemployment rate sits at a staggering 32.6%, with youth unemployment even more dire—reaching over 63%.
These figures paint a grim picture, but they fail to capture the full extent of the crisis: millions of young people are not just out of work but are locked out of the economy entirely.
Without education, employment, or training, they face a future devoid of opportunities and hope. The devastating impact of this crisis extends beyond mere statistics; it is manifesting in communities where hunger, poverty, and desperation are becoming entrenched.
In a country where over half the population is under 30, young people are disproportionately affected by economic marginalization. According to the latest Quarterly Labour Force Survey, more than three in five young people aged 15-24 are unemployed.
This is not just a cyclical downturn but a structural crisis that is unlikely to resolve without significant intervention. For many young South Africans, particularly those in rural areas and townships, finding employment is not simply difficult—it is virtually impossible.
The situation is particularly dire for young women, who face the dual burden of unemployment and systemic gender inequalities that further limit their access to the labour market.
Meanwhile, for many unemployed young men, the lack of opportunities has fuelled destructive cycles, including the growing heroin epidemic. Heroin, often referred to as nyaope or whoonga, has devastated many communities, leaving young men trapped in addiction as an escape from the harsh realities of joblessness and poverty.
The long-term consequences of this are devastating. A generation that remains shut out of the economy is a generation without the means to build lives, families, or futures. They are at risk of falling into permanent poverty, leading to social instability and the perpetuation of generational inequality.
Parallel to the unemployment crisis is the escalating problem of hunger. The Pietermaritzburg Economic Justice and Dignity Group’s Household Affordability Index indicates that an increasing number of households cannot afford basic food staples.
Many South Africans are surviving on less than R1,268 per month—the food poverty line. In poorer provinces, like the Eastern Cape and Limpopo, the situation is even more acute. For too many, hunger is not a temporary inconvenience but a daily reality.
The relationship between unemployment and hunger is stark. Without jobs, people cannot afford food, and hunger exacerbates the cycle of poverty. Families are forced to make impossible choices between paying for shelter, healthcare, or education, and putting food on the table.
Children growing up in food-insecure homes are at risk of malnutrition, stunting, and long-term cognitive damage, which perpetuates the cycle of poverty. In the absence of adequate social support, hunger is turning from a temporary crisis into a structural feature of life for millions.
The idea of a Basic Income Grant (BIG) is not new, but it has gained significant traction globally as a solution to the twin crises of unemployment and poverty. A BIG is a guaranteed monthly payment from the state to all citizens, regardless of employment status, designed to meet their basic needs and lift them out of extreme poverty.
This concept has moved from theoretical debates to real-world trials in countries across the globe, demonstrating its potential to address poverty and inequality while stimulating economic activity.
One of the most well-known examples of an income support program is Brazil’s Bolsa Família, introduced under the leadership of President Luiz Inácio Lula da Silva in 2003. This family grant system provided monthly cash transfers to low-income families on the condition that children were sent to school and received regular health check-ups.
The program had a transformative impact on Brazil’s social fabric, lifting millions of people out of extreme poverty and reducing inequality significantly. By 2010, poverty in Brazil had been reduced by half, and extreme poverty had declined by 65%.
More importantly, Bolsa Família contributed to higher school attendance and improved health outcomes, helping to break the cycle of intergenerational poverty.
Brazil’s experience provides a crucial lesson for South Africa: a well-designed income grant, particularly one that reaches the poorest, can be a powerful tool for poverty reduction and social mobility. It is not just a handout, but an investment in the future of the country.
By ensuring that people have the means to meet their basic needs, a BIG would free them from the immediate pressures of survival, allowing them to pursue education, skills training, and entrepreneurial opportunities.
Other countries have also experimented with basic income and cash transfer programs with promising results. In Finland, a basic income pilot conducted from 2017 to 2018 provided 2,000 unemployed citizens with a guaranteed monthly income.
The results showed that while the program did not dramatically increase employment, it significantly improved participants’ well-being, reducing stress and mental health issues.
This underscores an important point: while a BIG may not instantly solve the problem of unemployment, it can provide much-needed security and dignity to those who are excluded from the formal economy.
In Kenya, the non-profit organization GiveDirectly has been running a long-term universal basic income experiment, providing direct cash payments to villagers in rural areas.
Early results show improvements in food security, mental health, and overall well-being. Crucially, these payments have allowed people to invest in small businesses, farming, and other local economic activities, creating a ripple effect that benefits entire communities.
South Africa can learn from these examples. The introduction of a Basic Income Grant would provide an immediate cushion to the most vulnerable, offering them the stability they need to participate in the economy meaningfully.
It would also help stimulate local economies, as recipients spend their income on goods and services, benefiting small businesses and creating jobs indirectly. The psychological benefits of income security—relief from the daily anxiety of survival—cannot be understated. A BIG would not only alleviate hunger but also restore dignity and provide hope to millions.
South Africa’s unemployment and hunger crises require bold, transformative action. As Matthew Parks from COSATU points out, “The reality is that millions of workers and their families are struggling to survive the daily grind of unemployment, poverty, and hunger.
“The government must act boldly and decisively to introduce a Basic Income Grant to help lift people out of despair.” Similarly, as Isobel Frye notes, "A basic income grant is not just about giving people money; it's about acknowledging the structural inequality that has locked so many out of the economy and giving them the means to live with dignity."
In a country as wealthy as South Africa, where the gap between the rich and the poor continues to widen, the time for a Basic Income Grant is now. It is not only a question of social justice but also of ensuring the future stability and prosperity of the nation.
By providing a foundation for all citizens to meet their basic needs, South Africa can take a significant step towards building a more inclusive, equitable, and hopeful society.
*Dr Buccus is a senior research associate at ASRI
** The views expressed do not necessarily reflect the views of IOL or Independent Media
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