As the student protests against fee hikes continue across South Africa, economists have warned that there will be far reaching consequences for the country’s economy if the 2016 academic year is not saved.

They say this is going to push up the unemployment rate and also put pressure on some State facilities, particularly in the health care sector, as final year medical students who could be assisting in different hospitals next year would fail to do so.

Students at different universities are protesting against fee increases and are demanding free education and there seems to be no end in sight to the current impasse between students, the government as well as universities on the “Fees Must Fall” campaign.

There are concerns that if the parties involved fail to find each other soon, the 2016 academic year could go to waste.

The Head of Research at Nedbank, Mohammed Nala, says a number of areas in the economy will be affected.

“There are a whole host of impact not just within the academic circles but in the broader economy within service delivery and just well in terms of medical students who have to find internships and flow through into our hospitals. So it should be priority number one at this point in time for both parties to find one another for pragmatic negotiation to resume and for people to move away from these idealists polar opposite, I mean at the end of the day negotiations are about compromise and that is going to be on the side of government, universities as well as students.”

Nala warns that there will be far reaching implications and issues of service delivery could be affected. “That is going to compound service delivery issues. Remember in terms of anyone’s long term planning they would basically be banking on the fact that they will get a certain number of graduates that would come through in any given year, so they would plan their staffing commitment around that. This is going to also affect service delivery and you know what happens when we have service delivery protests.”

Lehumo Capital economist Viv Govender agrees with Nala and says this is going to also affect communities who are in desperate need of certain services.

“You might find protests coming from those communities who need the road infrastructure, and other services and that really emanating from the fact that there is no labour absorbed from the new graduates.”

Govender also says there is a need for more doctors in state facilities and that if final year medical students are unable to complete their studies this year, it will put the hospitals under pressure.

“The skills coming into the medical sector of course, it is going to be quite important, especially when you consider how important medical students are, to the public sector they also assist in terms of the posting to other facilities and other skills needed in hospitals.”