The latest Debt Rescue survey paints a grim picture of South Africans struggling to make ends meet amid the cost-of-living crisis. With 46% of consumers going without basic necessities each month and a household debt-to-income ratio projected to reach 65% in 2024, millions are living hand to mouth, unable to afford enough food or electricity.
Impact of Electricity Tariff Changes
Neil Roets, CEO of Debt Rescue, highlights the severe socio economic challenges, condemning Nersa’s changes to electricity tariffs that make this essential utility unaffordable for many.
Consumer Cutbacks on Essentials
Significant cutbacks are evident, with 31% of respondents reducing general living expenses, particularly in electricity (23%) and food (23%), while 56% can’t afford medical aid. Despite these hardships, 34% switched to gas stoves, and 10% installed solar geysers to manage costs. However, 46% still go without each month, underscoring the unsustainable nature of the current situation.
Unemployment and Financial Distress
Unemployment and financial distress are prevalent, with the Debt Rescue survey showing a 27% unemployment rate among respondents and recent Statistics SA figures revealing a record 32.9% national unemployment rate. Despite this, 40% of respondents have started side hustles to supplement their income.
Roets warns that with rising interest rates and increasing debt-servicing costs, there is no light at the end of the tunnel for many South Africans.
