Economic Impact due to Taxi Strike: Businesses report widespread losses

August 07, 2023

Several business sector organisations affiliated to the Cape Chamber report widespread disruption related to the ongoing Western Cape taxi industry strike.

Although for many sectors it is too soon to quantify the economic loss, all report widespread absenteeism linked to commuter inability to reach the workplace.

One sector drew a parallel between the impact of the strike on business operations and the impact of Covid-19.

Some of the impacts to date include:

Retail Motor Industry Sector: 50% workforce impact, which has implemented a “no work, no pay” policy. Turnover has so far been significantly affected, with fewer customer visits
Business Process Outsourcing Sector: Significant impacts, with fears that negative publicity might result in operations shifting away from Cape Town
South African Oil & Gas Alliance: Partial workforce impacts in strike-affected areas
The Independent Community Pharmacy Association: Staff using public transport to work from home
Fish SA: 80% of the workforce affected. A substantial number of workers were either absent from work or arrived late. Factory operations were notably affected, leading to underutilised production lines
Federated Hospitality Association of Southern Africa: Anticipated sharp decline in bookings in local establishments in light of the UK issuing a safety warning for its citizens in Cape Town. This concern is amplified by the fact that the sector is currently in its peak booking season, which aligns with the upcoming summer period
Wholesale and Retail Sector (Franchise Association of South Africa): Still compiling statistics
The Furniture Manufacturing Sector: Absenteeism of around 60% in some of the larger establishments
The South African Association of Freight Forwarders: Severe impact. The airport and its precincts were blocked off, preventing airfreight from getting through.

Additionally, the Cape Town Port operated with only 60% of its staff, significantly hampering ship movements, container discharge, and collection/deliveries. As a result, goods are not reaching production lines, and finished products are not reaching consumers.

Export activities are also affected due to concerns for staff safety, further impacting the movement of goods and products
National Clothing Retail Federation:30% non-attendance, 30 -- 40% latecomers, and a huge drop in the consumers through the stores. Numbers are down and will affect turnover
PTSA: Training centre affected and forced to find overnight accommodation for affected students. Board meeting was cancelled due to airport security fears

Furthermore, the Western Cape Department of Economic Development and Tourism (DEDAT) recently conducted a survey to assess the extent of disruption experienced by local businesses due to the ongoing taxi strike. The survey gathered responses from 594 participants, representing 400,000 employees and 64 industry bodies.

Astonishingly, 75% of respondents reported that more than half of their workforce had been adversely affected by the strike.

Financially, the impact was significant, as 69% of participants reported income losses due to transport disruptions; 32% disclosed losing over 50% of their daily earnings due to the turmoil; and while 62% managed to maintain their operations, a concerning 38% struggled to sustain normal activities amidst the disruptions.

Download the full survey conducted by DEDAT here.

Derryn Brigg
Deputy President of the Cape Chamber of Commerce & Industry