28 October 2022

The conference, hosted by the Department of Culture, Sport and Recreation under the theme: Year of Unity and Renewal: International Solidarity and Cultural Diplomacy, Redefining 21st century global, makes an annual call for academic papers on various subjects to value ignored voices and to make them part of the nation's oral history.

“This year's call had the informal sector as one of their concerns. Since I’m passionate about this sector and its data representation, I felt obligated to put together a paper on the subject,” he said.

Shabalala, a Development Studies student, presented his research paper on the impact of Covid19 on self-employed professionals, informal sector, and small businesses; and the challenges faced by self-employed professionals, informal traders and small businesses during the pandemic.

Like many countries, South Africa’s inequality is tied to its colonial history: the socio-economic and spatial design fail to serve and support economic activities equitably.

Pre-existing economic inequality

“This is because of the pre-democratic separate development. The duality that reflects in the society’s economic inequality stems from years of exclusion that makes the livelihoods of the previously disadvantage vulnerable. This vulnerability escalated particularly for self-employed professionals, informal traders and small businesses due to the unanticipated Covid-19 pandemic.

This remains true, although businesses and business individuals are always perceived to possess unlimited abilities to solve society’s problems, yet they too encounter numerous challenges many of which remain untold.”

The research findings were that the nature of small and informal businesses as well as the self-employed individuals’ financial prowess in South Africa, business conditions prevent these entities to have crisis management systems in place to assist in the event of a force majeure.

The informal sector lack in start-ups, they often must depend on relatives and friends to fund their businesses. With the detriment of Covid 19 many informal traders after failing to trade due to restrictions, lost their stock and had difficulty restarting their businesses.

“The sector is dominated by the poor and as such they don't have savings to deal with a crisis such as Covid 19. Since the sector is informal, traders often get aid assistance late or never to help them survive in times of crisis,” he added.

“This shifts the focus from just profit-centred value towards a holistic value considering things such as the social, political, and environmental value amongst others, to enable businesses to create a conducive and responsive environment for business operation that is critical in times of crisis.”

Preventative measures

Shabalala further explained that businesses vary, and risks and unforeseen conditions might arise at any time. When it comes to business, one can never be completely certain, and things don't always go as planned.

“People's successes and misfortunes are not the same for everyone, nor are they experienced in the same manner. In business, it is all about taking measured chances and believing in your own ability to succeed,”

He added that it is critical for businesses to follow compliance regulations to create an ethical corporate environment for everyone, which benefits both individuals and the economy.

Some of the recommendation included capacity building from both government and the informal sector in administration of the unique business demands of the informal sector.

“There is a need for responsive policies and practices that help the sector stabilize and attain sustainability, and robust stakeholders’ integration to help informal trader set up systems that assists them administrate effectively,” he said.

Shabalala further said digitization of the sector to help it adapt to the modern trade practices and demands came out tops, and informal traders should be encouraged to start saving and investing funds, which will help grow the informal sector and improve its financial viability.

The presentations are considered to form part of the Oral History and attempts are made to represent the experiences by Oral History Association of South Africa.

“These add value to his academic contribution; this data will form a basis as we grow our business venture in the coming years. Data is one of the key challenges of the informal sector, a gap we seek to close with the company as we are going.”

@ Story by Lisa Thabethe. Pictures supplied