Will the SRD Grant Reduce Unemployment in 2025?

The unemployment rate in South Africa is at 31.9% in Q3 2025, and while it’s lower when compared to last year, it’s still rather high. By comparison, the average global unemployment rate in 2024 was 4.9%. That’s why the government decided to introduce a grant designed to alleviate poverty and help unemployed people cover their expenses.

Called the Social Relief of Distress grant, this was a very handy tool for the past few years, but will the SRD grant reduce unemployment in 2025 and beyond? Let’s find out!

Based on common SRD queries and status checks we see from applicants, the grant continues to provide short-term relief but has not significantly changed employment outcomes.

Where did the SRD grant originate from?

During the COVID crisis, a lot of people in South Africa did not have a workplace, and many employees were laid off. As a response, the government decided to create the SRD grant, which would be provided as an emergency cash transfer solution for adults of working age who had no income. 

Since May 2020, beneficiaries have received monthly payments under the SRD grant, initially set at R350 and later increased to R370.

One thing to note is that it targeted those who were not accessing any other social assistance programs, like the unemployment insurance fund or anything similar. However, there were lots of discussions about either ending the program or making it a permanent solution.

Although the programme was initially scheduled to end earlier, Finance Minister Enoch Godongwana confirmed that the SRD grant has been extended until March 2027, with the payment amount remaining at R370 per month.

How does the SRD affect unemployment?

Many people are wondering whether the SRD grant will reduce unemployment in 2025, and the answer is not straightforward.

The grant has various benefits, but also downsides.

• The grant helps people support their expenses on local services, transport, and food. That means there’s an increase in local demand, which is beneficial for local services, small shops, and informal traders. However, that’s a short-term benefit.
• There’s also a boost when it comes to job search and matching. Having a regular, modest transfer will help boost job search quality. The grant allows applicants to buy a phone and afford transfers to interviews, or even deal with short demand spells, all of which can be very challenging. 
• However, it also brings a work disincentive. Since people have access to this grant, they will have some way of supporting themselves and their costs. That means they might skip low-paying work, and instead, they might remain unemployed a little longer. While it won’t affect all job markets, it will have a negative impact, especially on lower-paying jobs.

If you have applied for the grant or are currently receiving it, you can check your SRD application status to see whether your payment has been approved, declined, or is still pending.

Will the SRD Grant Reduce Unemployment in 2025?

The answer to whether the SRD grant will reduce unemployment in 2025 is difficult to pinpoint, but current evidence suggests it is unlikely.

And there are multiple reasons behind this, as follows:

• The poverty line in South Africa is around R624 to R700 in 2025. The SRD grant only covers around 50%-60% of that, and it’s not enough to cover the minimal living costs of a person within the country.
• The grant is not addressing any major root causes behind high unemployment rates. Things like economic demand or a lack of adequate skill training are still issues that need to be addressed. Unfortunately, this grant is not a solution for them.
• Due to the low amount offered, the grant is not enough for investments in relocation, education, or anything similar.
• While these grants help preserve informal jobs, they come with limited mobility upward, and they also bring low wages. 

It’s important to note that the SRD grant can be useful, but it needs to be a part of broader packages. Combined with things like an administrative reform, a public employment program, and improvements related to active labor markets, it becomes a powerful strategy to help people get out of poverty and not rely on government-provided income. However, on its own, it’s a social protection instrument that works well only for the short term.

Although around a third of South African adults don’t have a job, social measures like these can be supportive. But as we mentioned earlier, they have to be combined with an adequate, advantageous system for businesses, which will encourage them to hire people, and thus lower the unemployment rates. At this time, the SRD grant is useful, but it barely keeps unemployed people afloat with their current expenses.  

Conclusion

So, will the SRD grant reduce unemployment in 2025 or beyond? We don’t think that’s the case; however, this still is a valuable social instrument that helps unemployed people stay afloat, at least in the short term.

If you are currently receiving the SRD grant, you can check your SRD application status and payment dates directly on Checkmygrant.co.za.