Chapter 4: COMBINED FINDINGS AND ANALYSIS
4.1. Overview and Background of the Case Studies
CBD
Wilson (2009) notes that in congruence with other contexts, the scarcity of jobs has pushed large numbers of people into the ‘informal economy’ in order to survive. As mentioned above, Msunduzi provides just over 59% of total employment in the district and the surrounding rural local municipalities experience high levels of unemployment (Urban-Econ Report, 2008 cites Urban-Econ, 2007). Poverty had increased significantly between 1996 and 2004 in all the local municipalities in the district except in Msunduzi, where there was a decrease of 7% in the number of people living in poverty (Ugu District Municipality, 2007; SDF Review, 2009). However, there had been an increase in unemployment in all local municipalities in the district including Msunduzi between 1996 and 2004, implying a disturbing trend of jobless economic growth. According to the 2001 census, the unemployment rate sat at 30.6% and at 48% in 2004 (Msunduzi Municipality, 2008). These factors have led to strong push-pull factors drawing people to Msunduzi’s informal economy resulting in an ever growing population that has intensified its already present socio-economic problems (Wilson, 2009).
4.1.2. Hibiscus Coast Municipality
The Hibiscus Coast Municipality (HCM) is located on the South Coast of KZN, 120 kilometres south of Durban; forming a link between the Eastern Cape and the Durban harbour within close proximity to major national road networks and with an airport (Hibiscus Coast Municipality, 2008/9). It is seated in Port Shepstone and falls under Ugu District Municipality in the KZN Province. HCM consists of an estimated population of 272 467. Between 2000 and 2003, the growth rate for the HCM was estimated at 2.4% per annum which is above Ugu District’s growth rate at 2% respectively in the same period (Hibiscus Coast Municipality, 2008/9). Port Shepstone is the largest town with the highest population density per square kilometer, and is also the administrative, magisterial, political, educational and commercial centre for the Hibiscus Coast region (HC Hibiscus Coast Municipality, 2008/9; Guyot, 2001; Ugu District Municipality, 2002).
Port Shepstone functions uniquely as an industrial town commanding an urban network of smaller towns dotting the coastline which serve as seasonal recreational hubs, featuring a wide range of tourist-oriented businesses (Guyot, 2001;
Hibiscus Coast Municipality, 2008/9). Hibiscus’ six traditional settlements constitute the dominating rural component which is largely under the ownership of tribal authorities. The majority of the total
Figure 2: Map showing Hibiscus Local Municipality
population is African at 84%, who are unevenly spread among the municipal wards, however largely residing in peri-urban and informal urban areas, and the rural areas of the traditional settlements (Hibiscus Coast Municipality, 2005/6; Guyot, 2001). Therefore, much like Pietermaritzburg, the legacy of apartheid is evident in the spatial allocation of land which continues to run along race lines evident in the uneven developments between the town centre and suburbs, the developed coastal strip and the underdevelopment of the rural hinterland and informal areas that experience high levels of poverty and lack access to land, economic opportunities and social services (Ugu District Municipality, 2007).
In 2005, more than 60% of all economic activity in Ugu took place in the Hibiscus Coast Municipality (Hibiscus Coast Municipality, 2008/9). The broad unemployment rate in Ugu district was above 52% in 2001 and 42% in Hibiscus. Therefore there has been a ‘pull effect’ of people from within the district and the Eastern Cape seeking work into Hibiscus, particularly where it experiences seasonal population increases due to tourism with implications for service provision and infrastructure (Hibiscus Coast Municipality, 2007/11). Guyot (2001) adds that for rural inhabitants, Port Shepstone as an industrial town is the area of potential jobs because the remaining coastal tourism-based towns are controlled largely by the white population in established businesses. The steady in-migration of people into the urban centres of Hibiscus however began from the early 1990s as a result of people fleeing from political violence between members of the ANC and Inkatha Freedom Party (IFP) camps in the rural hinterland areas (Guyot, 2001; Robbins, 2010).
4.1.3. Comparative Analysis
The population growth rate of Msunduzi at 2.5% per annum is closely matched by Hibiscus at 2.4%, both of which are above the national average at between 1-1.1% and the KZN average of 2% per annum (Msunduzi Municipality, 2008/9; Hibiscus Coast Municipality, 2008/9). This coupled with the findings of the scarcity of jobs from the surrounding underdeveloped areas and the presence of informal areas in both contexts, is indicative of the in-migration of people into the respective municipalities in search of work opportunities. This is primarily because both contexts are the economic and employment hubs of their respective districts.
The findings demonstrate that the influx of people working informally in public spaces within a short space of time prompted Msunduzi to engage the informal economy as part of its management duties (Chairperson, Informal Trade Task Team: 03/03/2010; Senior LED Official: 12/02/2010).
There was a further expansion due to the deregulation of trading opportunities that came with the democratic transition, the growing numbers of foreigners and the trend of the informalisation of the formal sector. Similarly in Port Shepstone, a respondent described that ‘…around 1994, there were not many hawkers, they never stood on anybody’s toes especially the formal traders. They were on the ground, on the pavement; they didn’t have any footprint here…’ (CBD Formal Business Representative: 23/04/2010). Like Msunduzi, there was a drastic increase of informal trading and especially with the democratic transition, particularly during holiday seasons and due to the growing trend of the informalisation of formal businesses and foreign informal traders (Hibiscus LED Manager: 31/03/2010). This expansion of the informal economy in both cases is congruent with the literature by Todes (2001) and Nel (1997) which highlights the in-migration of people into secondary
cities and towns from surrounding underdeveloped areas and the reliance on migrant or commuter workers remittances including self-reliance strategies in the informal economy. However unlike Msunduzi, political conflicts also contributed to many rural people fleeing into the closest urban centres of the Hibiscus region.
Moreover, with unemployment rates as high as 30.6%-48% in MLM, and 42-56% in HCM, the influx of the poor and unemployed from the surrounding areas has intensified existing socio- economic problems subsequently exerting more pressure on infrastructure, facilities and resources as suggested by Nel (1997) and Pillay (2008). However the little reliable data on the informal economy in Msunduzi shows that it is small in comparison to other city centres as noted by Wilson (2009). Due to the data being sparse, it is difficult to verify and speculate causal explanations for this. A reason may be that Msunduzi is a large source of formal employment particularly in general government services, being the administrative and political capital of KZN, followed by jobs in finance and business services which employ high-skilled professionals (Coetzee, 2009). Similarly, Hibiscus is a source of more than half the formal employment opportunities in the district, particularly for government services, being the administrative centre of the district; followed by commercial sector jobs due to the established tourism industry (Ugu District Municipality, 2002).
However, the absence of data on the informal economy in Hibiscus makes it even more difficult to estimate its relative size. However, at the district level, the informal sector reportedly constitutes 30% of all jobs in the tourism and retail sectors, and jobs in the agricultural sector are skewed more towards informal than the formal (Ugu District Municipality, 2007).