ALL analysts know how difficult it is to
understand and talk specifically about South Africans and their
behaviour and inclinations as a group. Even as we approach elections,
the much-maligned political animal is engaged in the insecure and
nail-biting exercise of categorising the population.
But there is one area in which we can say, with empirical evidence on our side, that we know the psychology of South Africans as it relates to their eating and drinking habits.
As many people know, there are two kinds of people in the world. There are those who are known as stress eaters, defined as a group who are inclined to munch away when the pressures of the world come knocking. And then there are those who tend to lose their appetite under these circumstances.
Data from Statistics SA suggest all too many South Africans are of the former variety — inclined to frequent the kitchen and hog the fridge when faced with tough times. Retail sales grew 3.4% in the first quarter of 2016 compared with the same period last year.
More than half of what we bought at the store was food and drink. Quite frankly, with all the economic and political problems we face, why shouldn’t we turn to the bottle?
As it turns out, we also medicate a bit more and believe our state of mind shouldn’t reflect how we feel. We also live up to the saying that we ought to dress for the economy we want and not the one we have. Testament to our tendencies, sales in the category of pharmaceuticals, medical goods, cosmetics and toiletries grew 5% year on year and grew 4% in the category of clothing, contributing a third of the growth rate seen in retail.
Evidently, the economy continues to stumble and there doesn’t seem to be a way to hold it up. While there was a time when our spending gave life to the economy, those days seem to be over.
The Reserve Bank’s announcement last week in its monetary policy committee statement suggested that since the last meeting, its view of economic progress this year has deteriorated. The gross domestic product growth rate forecast for 2016 was revised down by a quarter, to 0.6%.
It went on to revise down the following two years’ forecasts as the committee saw the country’s actual performance fall below its potential.
This is not a surprising outcome given the trail of frequently released numbers we’ve seen in the past quarter.
Manufacturing production remains under pressure and has declined by an average of 0.75% in the first quarter of this year, compared with the first quarter of 2015. The manufacturing of beverages collapsed by nearly 5% — despite the heat and drought.
So, while unemployment rose, with 355,000 jobs shed in the first quarter of the year, and as wage increases fell below inflation, we still found ways to spend.
According to the Reserve Bank, that spending didn’t necessarily come from borrowing, since we saw a continually "slow pace of credit extension to households", with negative growth in real terms.
Our failure to binge to lift the economy, as we used to do rather well, suggests a desperate need to do something different to turn around the economy.
If economists were psychologists, they would tell us that we need rehab. We need to take ourselves off this downward spiral in which our ability to spend and consume continues to outpace our success in producing. Our counterparts in China are causing havoc in the global economy trying to achieve the very opposite. China is attempting to reform and restructure its economy from one that is a factory to one that is more of a shopping mall.
This proves one thing that is true of all habits and personality types — too much of one thing is bad for anyone. China’s struggle is evident in the effects it is wreaking on the world economy, which came to depend on her obsession with building infrastructure and factories. SA should follow suit.
• Payi is an economist and head of research at Nascence Advisory and Research
But there is one area in which we can say, with empirical evidence on our side, that we know the psychology of South Africans as it relates to their eating and drinking habits.
As many people know, there are two kinds of people in the world. There are those who are known as stress eaters, defined as a group who are inclined to munch away when the pressures of the world come knocking. And then there are those who tend to lose their appetite under these circumstances.
Data from Statistics SA suggest all too many South Africans are of the former variety — inclined to frequent the kitchen and hog the fridge when faced with tough times. Retail sales grew 3.4% in the first quarter of 2016 compared with the same period last year.
More than half of what we bought at the store was food and drink. Quite frankly, with all the economic and political problems we face, why shouldn’t we turn to the bottle?
As it turns out, we also medicate a bit more and believe our state of mind shouldn’t reflect how we feel. We also live up to the saying that we ought to dress for the economy we want and not the one we have. Testament to our tendencies, sales in the category of pharmaceuticals, medical goods, cosmetics and toiletries grew 5% year on year and grew 4% in the category of clothing, contributing a third of the growth rate seen in retail.
Evidently, the economy continues to stumble and there doesn’t seem to be a way to hold it up. While there was a time when our spending gave life to the economy, those days seem to be over.
The Reserve Bank’s announcement last week in its monetary policy committee statement suggested that since the last meeting, its view of economic progress this year has deteriorated. The gross domestic product growth rate forecast for 2016 was revised down by a quarter, to 0.6%.
It went on to revise down the following two years’ forecasts as the committee saw the country’s actual performance fall below its potential.
This is not a surprising outcome given the trail of frequently released numbers we’ve seen in the past quarter.
Manufacturing production remains under pressure and has declined by an average of 0.75% in the first quarter of this year, compared with the first quarter of 2015. The manufacturing of beverages collapsed by nearly 5% — despite the heat and drought.
So, while unemployment rose, with 355,000 jobs shed in the first quarter of the year, and as wage increases fell below inflation, we still found ways to spend.
According to the Reserve Bank, that spending didn’t necessarily come from borrowing, since we saw a continually "slow pace of credit extension to households", with negative growth in real terms.
Our failure to binge to lift the economy, as we used to do rather well, suggests a desperate need to do something different to turn around the economy.
If economists were psychologists, they would tell us that we need rehab. We need to take ourselves off this downward spiral in which our ability to spend and consume continues to outpace our success in producing. Our counterparts in China are causing havoc in the global economy trying to achieve the very opposite. China is attempting to reform and restructure its economy from one that is a factory to one that is more of a shopping mall.
This proves one thing that is true of all habits and personality types — too much of one thing is bad for anyone. China’s struggle is evident in the effects it is wreaking on the world economy, which came to depend on her obsession with building infrastructure and factories. SA should follow suit.
• Payi is an economist and head of research at Nascence Advisory and Research
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