AT least 6064 workers in the clothing and textile sector lost their jobs due to the Covid-19 induced economic meltdown.
This is according to the Lesotho National Development Corporation’s (LNDC) Industry Status Report dated March 2021.
The report further states that between the period of March 2020 to March 2021 factory closures and downsizing immensely contributed towards the sacking.
“Two factories namely, Coating Company and Huan Sheng ceased operations, while Presitex and CGM merged. Nien Hsing International combined its five companies into three and is planning to combine the three companies into one,” reads the report.
The report further notes that lack of demand on the market led to the layoff of factory workers.
“Another contributing factor to employment is the decline in purchase orders as a result of the Covid-19 pandemic.”
The report however indicates that the textile sector still remains the top employer.
“The manufacturing industry constitutes 88, 8 percent of total employment in the industry despite the 12, 9 percent decline.
“Printing and embroidery sectors experienced the most employment decline of 82, 4 percent as a result of a company that shut down, followed by clothing and textile sector at 12, 9 percent.”
Another report titled Impact of Covid-19 on manufacturing Industry in Lesotho: Case study of LNDC- Assisted Companies released in November 2020 highlights that some factories were forced to retrench workers and while placing some on temporary layoffs.
“The employment levels for 2020 have been relatively lower compared to the same period in 2019. The lowest employment rate was recorded in April 2020 at 30 741, which is 24 percent lower than the one recorded in the same period in 2019. This decline is due to lockdown and company closures.”
“Some companies were forced to retrench workers while some factory workers had their hours cut during the lockdown. The highest reported employment level was 43 542 in February 2020, which was higher than that of the same period in 2019.”
The November 2020 report however highlighted that the impact of the Covid-19 lockdown on the production of the manufacturing sector was not as bad as they had anticipated.
“The impact of Covid-19 lockdown on the manufacturing industry has been minimal and below the levels anticipated. However, it is recommended that various relief measures are implemented to reduce the effects of Covid – 19 on companies as communicated by the government.
“The need to support and implement trade and trade-related initiatives cannot be overemphasized as the pursuit for the private-sector-led growth can meaningfully be achieved when interventions targeted at empowering and strengthening the operations of the private sector particularly in trade and investments are prioritised.
“The potential to turn around the state of the economy and relief to government challenges that include high deficit and wage bills can be explored through focusing and committing to implementation of relevant business environment reforms to entice the private sector to participate,” read the report.