Azar Jammine: As SA population tops 56m, more skilled whites leaving

JOHANNESBURG — South Africa’s population growth is on a strong upward curve again after a successful roll out of antiretroviral drugs. Despite the economic depression surrounding President Jacob Zuma, the one good thing about his legacy is that he’s helped extend life expectancy. Of course, HIV/AIDS is still a huge problem in SA, with more people infected with the virus than ever before. But antiretrovirals are making it more manageable and providing some kind of quality of life. With the subsequent population growth as well, there is hope that South Africa’s economy can still spur on growth – but policies would need to change. What may be of concern is that the skilled white population in South Africa is shrinking, due mainly to emigration and falling birth rates. South Africa will need all the skills it can get if it wants a prosperous future. More needs to be done to encourage skilled people to stay in the country. – Gareth van Zyl

By Azar Jammine*

Encouragement can be drawn from the continued acceleration in the country’s population growth rate, to 1.61% in 2016/17, from 1.17% in 2002/03. The increase in the population growth rate is largely attributable to a sharp increase in life expectancy, from a low point of 53.5 years in 2005, to 64.0 years in 2017.

This can be ascribed largely to a decline in the proportion of all deaths due to AIDS, from a peak of 49.2% in 2006, to just 25.0% in 2017, presumably brought about by the increasing rollout of free antiretroviral drugs over this period.

Azar Jammine
Dr Azar Jammine is a leading South African economist.

However, migration also contributed towards a portion of the increase in the population, with approximately 2.0m of the 12.08m increase in the population over the past 15 years being accounted for by net immigration.

Mid-term population estimates suggest that by the middle of 2017, the population had risen to 56.52m, up by 12.08m over the past 15 years, compared with the 45.45m in 2002.

The proportion of the population which was Black African rose to 80.8% in 2016/17, from 78.0% 15 years earlier, whilst in contrast the proportion of the population which was White declined to 8.0% from 10.0% over this period, being overtaken by the relative increase in the Coloured population, to 8.8% of the total in 2017, from 8.6% in 2002.

Whereas around 95% of net immigration occurred amongst Black Africans, there was net emigration of Whites totalling an estimated 327,000, or about 7% of the White population over this period. This has left the number of Whites in 2017, of 4.49m, down by -62,000 since 2002, in contrast with the 10.18m increase in the Black African population, to 45.11m at present and the 1.05m increase in the Coloured population, to 4.96m by mid-2017.

Rapid urbanisation into Gauteng and the Western Cape seems to have persisted, with Gauteng now accounting for 25.3% of the total compared with just 22.7% in 2002 and the Western Cape seeing its share rising to 11.5% compared with 11.0% 15 years ago.

Theoretically, more rapid population growth could enhance overall economic growth. However, if education does not keep up with the increase in population, this can be a recipe for increased unemployment. It is also of concern that the growth rate of the population in the young working age category between 15 and 34 years has fallen sharply relative to the growth in those over the age of 60 and those under the age of 15.

This contributes towards the abysmal labour absorption ratio in the economy which makes the economy increasingly dependent upon an ever smaller proportion of the population.

Success in fighting death through Aids helps boost life expectancy and population growth

The latest mid-year population estimates published by Statistics South Africa show that the country’s population as having risen to 56.52m by the middle of 2017.

The growth rate in the population has continued to accelerate, reaching 1.61% in 2016/17, from just 1.17% in 2002/03.

This can be largely ascribed to success in reducing the incidence of death through AIDS. Even though the actual number of persons carrying the HIV virus has continued to rise, to a record 7.06m, or 12.57% of the population, up from 4.94m or 10.91% of the population in 2002, the proportion of the country’s deaths arising out of AIDS has plummeted. It reached a peak of 49.23% in 2006, but has since fallen to just 25.03% of all deaths in 2017. 

Presumably the success in beating off deaths through AIDS can be ascribed to the introduction of free antiretroviral treatment from 2005 onwards, with the rollout of such treatment having increased progressively over the period.

This trend has also resulted in a continuing sharp increase in South Africa’s life expectancy, with the latter reaching 64.0 years in 2017 compared with a low point of 53.5 years in 2006. Females account for 51.1% of the population and males 48.9%. However, the prevalence of HIV is proportionately far greater amongst women, at 21.17% for those women aged 15 to 49 years, compared with the average prevalence for the overall population at 12.57%. The average life expectancy of females has risen from a low point of 54.7 years in 2006, to 66.7 years in 2017, a proportionately bigger increase than that of the life expectancy for males, which has risen from 52.3 years in 2006, to 61.2 years in 2017.

With women having a higher prevalence of HIV amongst them, the free roll-out of antiretrovirals has assisted the life expectancy of this gender proportionately more than is the case with males.

Whereas the difference in gender life expectancy was 3.4 years in 2006, it has risen to 5.5 years in 2017. Furthermore, with a proportionate benefit of free antiretrovirals accruing to women, many of whom are of childbearing age, the incidence of transmission of the HIV virus to infants has fallen, with the infant mortality rate declining from a peak of 49.1 per 1000 births in 2005, to 32.8 deaths per 1000 births in 2017.

Is increased life expectancy and population growth good for the economy?

Encouragingly, the rollout of free antiretroviral drugs has seen a decline in the prevalence of HIV amongst the youth, i.e. those between 15 and 24 years, to 4.64% in 2017 from 7.31% in 2002. However, these trends have also contributed towards a skewed growth rate distribution in the population. Whereas in 2002, the population growth rate amongst children under the age of 15 was -0.85%, it has since risen to 1.56%. Similarly, the growth rate in the population of those over the age of 60 has increased from 1.34% in 2002, to 2.99% in 2017. In contrast, the growth rate in the population of persons between the ages of 15 and 34 has fallen from 2.48% to just 0.18% over this period. It is estimated that 29.6% of the population is aged below 15 years and 8.1% is made up of persons aged 60 years or more.

This raises a huge point of debate. Is the manner in which the population growth rate is increasing and life expectancy rising a good thing or a bad thing for the economy? Theoretically, faster population growth should mean higher growth for the economy overall. It means a greater opportunity for businesses to sell into faster growing markets. The reduction in the relative proportion of the population of working age helps to limit the increase in the unemployment rate. However, to the extent that the growth in the population is skewed towards the very young and very old, it raises the question of whether there will be enough persons of working age population to supply the goods and services needed by the overall population.

Furthermore, if education standards remain as weak as they have been in recent years, it also means that there are fewer persons available who can produce the goods and services that the country requires. In turn, this renders the economy ever more dependent upon imports of goods and services from abroad. Such a trend is conducive towards increased vulnerability to the concept of exploitation by foreigners and “colonisers”. This situation is also potentially aggravated by the fact that the number of Whites in the population, presumably many of whom are highly qualified or skilled, has been decreasing as a result of emigration.

Substantial immigration has also boosted the population

The net emigration of Whites over the past 15 to 20 years has contrasted with the net immigration of all population groups over this period. The acceleration in the country’s population growth rate is not solely attributable to the successful rollout of free antiretrovirals even though the latter factor is the dominant one contributing towards the increase in the population.

Approximately 2.0m of the 12.08m increase in the population between 2002 in 2017 can

be ascribed to immigration. Whereas the net immigration of Black Africans has been estimated to have been 2.20m between 2001 and 2016, there has been a countervailing net immigration of Whites of – 327,000 over this period.

Projections are that the acceleration in net migration will continue over the next five years, with such migration forecast to be 1.02m between 2016 and 2021.

There is an argument for being very concerned about the decline in the population of Whites due to emigration. Many of those who emigrate are drawn presumably from the most highly skilled sections of society and their departure from the workspace is likely to impact negatively on the capacity of the economy to grow at a faster rate. It is debatable whether the inflow of skilled persons from the rest of the African continent is sufficient to counteract the outflow of skills from large-scale emigration of Whites.

Continued urbanisation into Gauteng and Western Cape

Much of the immigration appears to be directed towards two provinces, viz. Gauteng and the Western Cape. Over the five-year period 2011 to 2016, net migration into Gauteng amounted to nearly 1m persons and into the Western Cape almost 300,000.

It is obvious that these are the two provinces where economic opportunities appear to be greatest. These trends are forecast to continue over the next five years, with net migration into Gauteng predicted at 1.05m and into the Western Cape at 310,000.

In contrast, the Eastern Cape has been losing more than 300,000 persons over each five-year period and Limpopo over 100,000. The result of rapid urbanisation is that Gauteng has easily surpassed KwaZulu Natal as the most populous province in South Africa, accounting for more than one in every four South Africans’ location, at 25.3% of the total population in 2017, up from 22.7% in 2002. The share of the population in the Western Cape has also increased from 11.0% to 11.5% over this five-year period.

These trends have also clearly manifested themselves on the political arena, with the opposition

Democratic Alliance having overtaken the ruling African National Congress in the main metros of these provinces in response to the dynamics of this urbanisation. Depopulation on the other hand has been the order of the day especially in the Eastern Cape and the Free State, but to some extent also in KwaZulu Natal, Limpopo and the Northern Cape.

  • Azar Jammine is the chief economist at Econometrix.
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