Street traders take the chance to earn living
Barriers to business keep sector relatively small in job-starved SA
Johannesburg is SA’s city of dreams to which people flock from across the country and the continent in the hope of scoring their big break.
The grind starts early in the morning and, in places, a commute is like a drive through a market. On sale at traffic lights and on the pavements of busy streets are knock-off branded hats, beaded ornaments, technology chargers and cables and cold drinks.
The informal sector has become a microcosm of the malls in SA’s cities and towns. In the central business district, all kinds of goods are available from street traders. The industry is valued at R750bn.
According to Statistics SA, “informal employment identifies persons who are in precarious employment situations irrespective of whether or not the entity for which they work is in the formal or informal sector”.
IMF resident representative to SA Montfort Mlachila says that, compared with the rest of sub-Saharan Africa, the informal sector in SA is relatively small at 25% of GDP. In Nigeria, for example, the sector makes up more than 60% of GDP.
According to the Quarterly Labour Force Survey, the share of total employment in the informal non-agricultural sector accounts for only 16.5%.
“Of course, given the high unemployment rate, creating jobs, no matter in which sector, should be a key priority. Some of the underlying reason for the relatively small role that the informal sector plays is the high barriers to starting businesses and self-employment, formally or informally,” says Mlachila.
Rosebank has become a creative hub with a handicraft market and hipster bars. Lloyd Tandi, a skilled bead worker and wire artist, has monopolised the corner of Jan Smuts Avenue and Bolton Road. It’s taken him 12 years to build a base. “To start on this corner, it was very difficult. It was a new thing in the area and people were not used to it. But as time goes on, people start to get interested,” says Tandi.
His biggest challenges are the bylaws and the police officers who make trading on the street difficult. “But you know, they understand that we’re trying to make ends meet. We’re trying to make a living.”
Tandi’s spot has become somewhat of a hub for other bead workers who are also commissioned for bigger projects. It’s difficult, but Tandi has built a steady clientele.
His prices range from R200 to R600 — whether it is a bird on a stick, a replica of someone’s dog or a soccer emblem. Tandi now exports to galleries in the US and has his own website.
“Money is never enough, but I’m supporting my family. I can afford to rent a cottage, I buy clothes, I bath every day, I look good,” he says.
In nearby Parkhurst, the informal economy is taking off. On the corner of Fourth Avenue and Twelfth Street, Ruth Ndwandwa sits with her granddaughter and greets every passerby. Ndwandwa has been making and selling baskets for 17 years. She sells for the first two weeks of every month and goes home for the last two weeks to make the baskets.
Her mother taught her the craft and it’s a tradition she passed on to her children and grandchildren, but she says there are better opportunities.
“My daughter used to help me but she got a job as a domestic worker a month ago. It’s better for her,” says Ndwandwa.
She sells baskets for between R250 and R500. In a busy month, she takes home up to about R10,000, but in winter she’s lucky to earn R4,000.
Ndwandwa used to be harassed by security companies and police officers, but this stopped after the informal traders in Parkhurst formed a community protection unit. While they sell their wares, they
keep a lookout and report suspicious activity.
Vincent Baloyi works 12 hours every day. He’s up early to get the freshest fruit and vegetables at the Pretoria market before heading to Parkhurst to set up outside a pub. “That side, the cops come and take our stuff. Here is better. No one really troubles us,” he says.
He started in 2007 with his brothers and eventually branched out on his own. Despite the constant stream of people, it’s a tough business.
“People have cards and don’t really have cash, but I earn enough to live [on],” Baloyi says.
In a country with 27.7% unemployment, persistently low growth and rising inequality and poverty, the informal sector is the last glimmer of hope for many. Stats SA’s Poverty Trends report showed that one out of every two South Africans was poor in 2015. People living in poverty declined from 66.6% (31.6-million people) to a still staggering 53.2% (27.3-million people) from 2006 to 2011.
Three out of five black South Africans, who make up 80% of the population, are poor while poverty among white South Africans remains “relatively nonexistent”, the report reads.
The informal economy has the potential to bolster growth in the entire economy and create more employment. According to a recent World Bank study, crime, strict laws, heavy competition and high concentration deter new entrants. Improving these conditions would go a long way in paving the way for more entrepreneurs.
The informal sector is alive and well and eager to do business with passing trade — it could benefit from more rolleddown windows and bargaining sessions before the traffic light turns green again.
MONEY IS NEVER ENOUGH BUT I’M SUPPORTING MY FAMILY, I CAN AFFORD TO RENT A COTTAGE