The coronavirus (COVID-19) pandemic has yet again affected another major African company, leading to loss of jobs and revenue. On Tuesday, July 7, South African media and e-commerce giant Naspers announced plans to lay off more than 500 employees and close a number of newspapers and magazines, including leading weekly tabloid the Sunday Sun.
The announcement which was made through its print division Media24 said the company would shut down one other national paper, four community newspapers, and four national magazines while outsourcing the majority of its monthlies and halving the frequency.
According to Media24 CEO, Ishmet Davidson, the benefits of prior interventions to offset the structural declines and keep the prints on the shelf no longer exist and they have “run out of options in this regard.”
The layoffs and closures come in the wake of planned job cuts at the South African Broadcasting Corporation (SABC). Similar measures were also taken at other members of the country’s “big four” print publishers such as Arena Holdings, Caxton, and Independent News. Almost 50,000 people employed in the printing sector could be affected by newspaper closures, the South African National Editors Forum said in June.
Given the high cost of data, quality news sites are reportedly difficult to access in South Africa, hence newspapers remain relevant and cost-effective. But print publications have taken a hit of between 40 percent and 100 percent to advertising and sales revenue in the wake of strict COVID-19 lockdowns in the country. This has forced many news agencies to migrate online where they earn a fraction of their former ad sales.
The wave of layoffs worsens the problem of unemployment in Africa’s most industrialized nation, becoming a matter of emergency for the government. Statistics South Africa’s quarterly labour force survey shows that unemployment rose from 29.1 percent in the last quarter of 2019 to 30.1 percent in 2020. Up to 7.1 million people were without jobs in the Q1 2020, up from 6.7 million in the previous quarter.
With the growing number of companies across multiple sectors announcing plans to layoff workers in order to remain afloat, South Africa’s unemployment rate may witness a further rise, experts say, calling on urgent efforts from the government to prevent further recession and rise in crime.