Quantec's Consumer Vulnerability Index (CVI) for South Africa has been at or below the 50-point index value for the past five quarters. A movement above 50 would indicate a higher than average vulnerability, while a value below 50 indicates a lower than average vulnerability.
The average CVI score amounted to 47,8 in the second quarter of 2013 – the same reading as in the first quarter of 2013.
Measured in terms of their vulnerability scores on a year ago, one component deteriorated (growth in real household disposable income), two improved (employment and real house price growth), while the other six components remained unchanged.
After reaching dangerously high levels during 2008, the index had, by mid 2010, dropped by 26 index points (down roughly 35%). During 2011 the index showed a slight deterioration to above the 52-point level before settling below the 50-point mark for most of 2012.
Households' vulnerability improved over the past three years mostly in the areas of indebtedness. Lower interest rates caused debt servicing costs to decline significantly, while households have made some tentative strides in improving their dissaving behaviour and strengthening their balance sheets.
Employment growth has picked up slightly and in the first half of 2013, total employment (measured as formal, informal and agricultural employment) was back at its pre-recession level of around 12,5 million people. However, growth in employment remained precariously low, averaging only 1,4% y/y during the past year which is insufficient to arrest the growth in the number of unemployed.
The economy's growth performance seem set to remain subdued in 2013 which will also not be conducive to ignite employment growth – especially against the background of low labour productivity growth and strike actions. Considering, in addition, the upward pressure on inflation, consumer vulnerability may deteriorate slightly during the second half of 2013 and first half of 2014.
Download the full report with underlying data & charts
The complete Quantec Consumenr Vulnerability Index is available every quarter to download for free to all EasyData users on EasyData. If you are not an EasyData user yet, you may create a free EasyData account to downlaod the CVI and more.