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  • 2022-12-06 (xsd:date)
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  • Race and private sector ownership in South Africa: three viral claims investigated (en)
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  • The tweet’s claim that there are 1.8 million white and 30 million black people of working age in South Africa is understated. The country has 40.2 million working age people, 2.84 million (7%) of them categorised as white and 37.3 million (93%) categorised as black. It’s mostly correct, if imprecise, that the private sector has an annual turnover of some R10 trillion while the government’s yearly budget is just R2 trillion. But the claim that white people control over 90% of the private sector is unproven as there isn’t enough data to support or debunk it. A viral tweet posted in October 2022 has some surprising figures about race and who owns what in South Africa’s private economic sector. It claims that 1.8 million white people of working age control over 90% of the country’s private sector, which has a yearly turnover of R10 trillion. By contrast, 30 million natives fight for a share of the government’s R2 trillion annual budget. Similar versions of the claim have been circulating for years. In 2017, former president Jacob Zuma said that only 10% of the top companies on the country’s main stock exchange were owned by black South Africans. The lack of racial equity in the ownership of South Africa’s private sector has been well documented. But are these numbers correct? We take a closer look. Statistics South Africa publishes data on the country’s labour force in the Quarterly Labour Force Survey . Information from around 30,000 households is collected and used to estimate employment statistics. The working age population is the people in a country who fall within a particular age range, usually 15 to 64. It is an estimate of the number of people who could be employed. But it doesn’t distinguish between people who are employed, unemployed or looking for work. The latest available data suggests that South Africa had around 40.2 million people of working age in the second quarter (April, May and June) of 2022. An estimated 2.84 million of them were categorised as white. This is 7% of the total working age population. There were 37.3 million people categorised as black ( including African, coloured and Indian people) in the same period. This is 93% of the working-age population. The claim therefore understates the number of black and white people of working age in South Africa. (en)
  • The tweet’s claim that there are 1.8 million white and 30 million black people of working age in South Africa is understated. The country has 40.2 million working age people, 2.84 million (7%) of them categorised as white and 37.3 million (93%) categorised as black. It’s mostly correct, if imprecise, that the private sector has an annual turnover of some R10 trillion while the government’s yearly budget is just R2 trillion. But the claim that white people control over 90% of the private sector is unproven as there isn’t enough data to support or debunk it. A viral tweet posted in October 2022 has some surprising figures about race and who owns what in South Africa’s private economic sector. It claims that 1.8 million white people of working age control over 90% of the country’s private sector, which has a yearly turnover of R10 trillion. By contrast, 30 million natives fight for a share of the government’s R2 trillion annual budget. Similar versions of the claim have been circulating for years. In 2017, former president Jacob Zuma said that only 10% of the top companies on the country’s main stock exchange were owned by black South Africans. The lack of racial equity in the ownership of South Africa’s private sector has been well documented. But are these numbers correct? We take a closer look. To examine this claim, we need to define some terms. The private sector is the part of the economy made up of companies for profit, and not controlled by the government. Nonprofit organisations and organisations run by the government make up the remainder. Annual turnover is the yearly income of a business or sector, before any costs. Stats SA’s Annual Financial Statistics (AFS) survey collects financial data like annual turnover from businesses in South Africa’s formal sector every year. ( Note: Data for the informal sector is sparse . Not all businesses are legally registered, and there is debate over what counts as an informal business. ) In the AFS survey, turnover includes sales of goods and services, as well as leasing of equipment, rights, properties and land. The latest survey , with data from 2020, puts the annual turnover for all the industries it covers at R10.98 trillion . How does this compare to the South African government’s annual budget? According to the national treasury’s budget review statistics for 2022, government spending totalled R2.16 trillion . (en)
  • The tweet’s claim that there are 1.8 million white and 30 million black people of working age in South Africa is understated. The country has 40.2 million working age people, 2.84 million (7%) of them categorised as white and 37.3 million (93%) categorised as black. It’s mostly correct, if imprecise, that the private sector has an annual turnover of some R10 trillion while the government’s yearly budget is just R2 trillion. But the claim that white people control over 90% of the private sector is unproven as there isn’t enough data to support or debunk it. A viral tweet posted in October 2022 has some surprising figures about race and who owns what in South Africa’s private economic sector. It claims that 1.8 million white people of working age control over 90% of the country’s private sector, which has a yearly turnover of R10 trillion. By contrast, 30 million natives fight for a share of the government’s R2 trillion annual budget. Similar versions of the claim have been circulating for years. In 2017, former president Jacob Zuma said that only 10% of the top companies on the country’s main stock exchange were owned by black South Africans. The lack of racial equity in the ownership of South Africa’s private sector has been well documented. But are these numbers correct? We take a closer look. We know that just 7% of South Africa’s working age population is white, but how much of the private sector is controlled by this group? The answer isn’t simple. First, it depends on how we interpret control. The lack of a definition is pointed out in replies to the tweet. By what measure do whites ‘control’ 90% of the private sector? one Twitter user asks . The second and perhaps bigger hurdle in answering this question is the lack of good quality data. Africa Check spoke to Imraan Valodia , head of the Southern Centre for Inequality Studies at the University of the Witwatersrand. He said it would make sense to measure control in terms of the share of the management positions held by people of different races, or at how the ownership of companies was divided by race. But this data is difficult to come by. We simply don't have a comprehensive dataset to allow us to monitor change, Valodia said. The data that does exist is patchy, [and] is sometimes of poor quality. White people over-represented in management positions Top and senior management are the highest job levels in South African companies. The Commission for Employment Equity publishes data on the population groups that occupy these levels in the public and private sectors each year. Its latest annual report , using data from 2021, sheds light on the racial makeup of management in companies. It doesn’t compare the numbers to the population as a whole. Instead, it compares them to the economically active population – people who are working or looking for work, excluding people who cannot or will not work. In 2021, economically active white South Africans made up just 8.8% of the total economically active population, but held 66.2% of top management positions in the private sector. In contrast, the share of top management positions held by black South Africans ( defined as people designated as African, coloured and Indian) was 30.7% , even though this group made up 91.2% of the economically active population. Senior management positions for 2021 have a similar pattern. The report shows that 56.6% of these positions in the private sector are occupied by white South Africans, while black South Africans occupy 40% . If representation at these management levels is interpreted as control, white South Africans do exert more control over the private sector. But the statistics still do not support the claim that 90% of the private sector is controlled by this group. More data needed on race and ownership Another way to interpret control is in ownership – the share of people from the different population groups who own private companies. This is difficult to measure accurately, as Africa Check has previously reported. Little data is available, and where it does exist, different definitions of key measures are used. We have to make do with what we can, Valodia told Africa Check. Broad-based black economic empowerment (B-BBEE), a government programme introduced in 2003, aims to increase black people’s participation in South Africa’s economy. It has a range of initiatives, one of them to track racial transformation of the economy by gathering information from companies each year. The Broad-Based Black Economic Empowerment Commission publishes data on employment and race in the South African economy. Madidimalo Ramare, a case management and administration official at the commission, directed us to their latest transformation report . Using data from 2021, the report looks at data from the B-BBEE compliance reports submitted by companies listed on the Johannesburg Stock Exchange (JSE). Of course, the 300-plus listed companies do not reflect every private company. But as shown in a 2021 working paper from the University of the Witwatersrand’s inequality research unit, the Southern Centre for Inequality Studies (SCIS), there is often little other data available. And as Reg Rumney , former head of the South African Reserve Bank Centre for Economics Journalism , points out : Racial ownership of the JSE ... is a proxy for ownership of the economy in general, especially in the absence of other indicators. For the 130 companies included in the report, black ownership was just 39% . The remaining 61% reflects ownership by white South Africans and by foreign nationals. The latter figure is not broken down further. But there is an important issue with the data in this report. As the commission points out, there were 324 JSE listed companies at the end of 2021 but only half (130) were analysed in the report. So it’s difficult to conclude anything about all the companies as a whole – we don’t know if the sample properly represents all JSE companies. We need more data about the ownership of unlisted companies – formal and informal, Michelle Joubert, author of the SCIS’s working paper , told Africa Check. And according to Valodia, the limited information on the informal economy and small business sector means we are only getting a partial view of race and ownership in the private sector. Without the necessary data, there is little evidence for the claim that 90% of South Africa’s private sector is controlled by white people – either in terms of management or ownership of companies. (en)
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