Almost 70% of people who start an informal business do so because they are unemployed and have no alternative source of income. This was just one of the findings of the Survey of Employers and Self-Employed (SESE) released by Statistics South Africa (Stats SA) on Thursday.
The SESE, which is conducted every 4 years, collects information about non-VAT registered businesses, most of which are in the informal sector. In 2013 there were 1,5 million people running an informal business, an increase from the 1,1 million recorded in 2009. This is still less than the 2,3 million recorded in 2001, and demonstrates the negative effect the global recession had on this sector. Informal businesses are predominantly run by black Africans, persons aged 35 – 44 years, and those with lower levels of education.
Turnover levels and profit margins are relatively small for most informal businesses. In 2013 more than 50% had a turnover of R1500 or less in the month prior to the survey, and less than 10% of businesses made net profits of more than R6000.
These are just some of the finding of the 2013 SESE. For the full report please click here.