Each year, ITWeb does a wrap-up of liquidations in the ICT sector, and compares those figures to previous years in a bid to determine the general health of the sector. Sure, some closures are simply guys shutting up shop to head off overseas, or to go into another business; others - those that aren't voluntary - paint a picture of which companies are under strain.
The data, usually provided by what is now the Companies and Intellectual Property Commission (CIPC), reveals company names, dissolutions, forced liquidations and voluntary liquidations. The information is based on some sort of internal code: SIC 86.
However, when I asked for the exact same information this year, I was dealing with someone else, as opposed to the person who understood what I need and why I cannot get the information from Statistics SA, which for some reason lumps communication with transport and logistics.
Mining data
Dealing with a newbie required quite a bit of explaining on my side, and eventually I ended up chatting to some guy in the CIPC's IT department. Finally, or so I thought, I was going to get pretty much what I needed.
Because of changes in the new Companies Act, the statistics would not be perfect, as it is no longer mandatory to have a specific principle business. So the numbers may have been a bit out.
The CIPC cannot strip out individual sectors, and in that way, provide insight into how healthy business conditions are.
Fine, even that I could live with, because they wouldn't be that glaringly wrong, and the name of the enterprise should be a giveaway.
Some time after I had initially requested the information, I received a response. It was completely and utterly useless. However, I can tell you there were 2 107 voluntary liquidations, 320 final liquidations, and 9 053 de-registrations, while one company filed for business rescue.
That's the information I received in response to my query about ICT liquidations, and those numbers looked alarmingly high. So, I queried this and it turns out that those are across the CIPC's entire database, and not just for the sector that I wanted, as the CIPC is apparently unable to strip out those numbers.
My problem is not that I, as a journalist, couldn't get what I wanted; my problem is that the CIPC cannot strip out individual sectors, and in that way, provide an insight into how healthy business conditions are.
Meaningful intelligence
The CIPC should be able to use its data intelligently, right down to whether the companies that are closing are one-man shops or mega entities. That will show where the pain is, and provide a starting point from which government can intervene and aid with aspects like tax breaks.
We need intelligence to know where to focus, and we need it now. Reserve Bank governor Gill Marcus has already said SA is only going to grow at about 2.5% this year, and that's way too low to lead to any meaningful job creation.
SA desperately needs jobs, and government has an ambitious plan to create five million jobs in the next decade, and these jobs are meant to come from sectors such as infrastructure, agriculture smallholder schemes, mining, tourism and exports.
That's nice. I can only hope the state has done its homework and looked at the business health of each of these, because from where I'm sitting, information as to how companies are doing in specific sectors just isn't available.
And without it, how can we plan to prioritise growth sectors and aid battling industries in a bid to create jobs?
Share