In fact, as European countries such as Greece, Ireland, Italy, Portugal and Spain struggle to keep their economies afloat and the US debates elements of legislation to reduce its deficit and raise the debt ceiling by August, local economists are painting a bleak picture of a double-dip recession.

Chris Hart, an economist at Investment Solutions, says slow growth in Europe, Asia and the US in the previous quarter is a sign that the world is heading back into the recession.

"My biggest worry, in that context of a slowdown, is that we are having strikes, and we are likely to struggle in the third quarter," he said.

"If not for the strength of the rand, we would be much worse off."

Lullu Krugel, a senior economist at KPMG, said the economy was dependent on the health of the average consumer because more than 60% of gross domestic product was contributed by spending in sectors such as retail, banking and property.

"The pace of inflation increases has also quickened, with food inflation, increases in fuel prices [although there has been some relief of late] and electricity price increases hitting the pocket of the consumer," she said.

Inflation, combined with job losses and lower pay increases by employers to reduce the number of potential retrenchments, had led to the South African consumer - already deeply indebted - feeling even greater pressure, Krugel said.

Several major companies are consulting unions about restructuring of their businesses that will inevitably lead to job losses.

Loane Sharp, Adcorp's labour market analyst, said big private-sector companies would be worst hit by the retrenchment tide this year, with the government and its parastatals unlikely to shed jobs.

Retail giant Pick n Pay is the first, with plans to retrench 3000 employees.

Announcing the retrenchments last week, operations director Neal Quirk said the decision was motivated by declining profitability and loss of market share.

"We've worked hard at looking at possible alternatives that may reduce the number of full-time people affected and these options will be discussed during our consultation process with the union," he said.

Azar Jammine, a chief economist at Econometrix, said he did not anticipate a major downturn in domestic economic growth over the next 18 months, barring a double- dip recession in the world economy, which could not be ruled out.

The fears come on the back of Adcorp's Employment Index, released on Monday, that showed 127000 permanent jobs and about 5712 temporary jobs were lost last month.

While Japan's growth has been slowed by the tsunami, economists predict that countries like the US and Italy will take a few years to recover from the 2008 recession because of sovereign debt - money owed by their central banks.

Economists say pressure on the South African economy is intensified by:

• An increase in inflation, caused by exorbitant electricity tariff hikes and petrol price increases, among others;
• Companies selling off some of their assets to finance debt, which caused the 2008 recession;
• Over-indebtedness of consumers; and
• Foreign companies' reluctance to invest in a country where there is political tension and demanding labour unions.

Ronel Oberholzer, a senior economist from IHS Global Insight, said South Africa's recovery from the 2008 recession was hampered by its lack of competitiveness, a result of "increasingly militant and demanding trade union activity".

"When investors are presented with a choice between investing in an economy with rising political and social tension and a labour force that presents significant disruption to the economy and demands double-digit wage increases (even if they are justified) or an economy with weak unions, cheap semi-skilled labour and an environment that is conducive to attracting investment, most investors would pick the latter.

"Unfortunately, there are numerous countries which fall into the latter category, and they are the ones that are experiencing high growth rates since the recession," she said.

Lew Geffen, the chairman of Sotheby's International Realty, said his group had lost 20% in profits in the quarter ending in June.

He said the situation was replicated across the property sector, which was suffering from a soccer World Cup hangover.

"Our economy does not seem to be picking up as much as it should be, and this is also because of the strikes, the National Credit Act and political utterances from certain people - that has caused jitters in the market."