While the official unemployment rate has decreased, economists say employment remains the most pressing policy challenge for the Government of National Unity (GNU).
These were the sentiments shared as Statistics SA (Stats SA) released the Quarterly Labour Force Survey for the third quarter of 2024, indicating an increase of 294 000 jobs.
The official unemployment rate decreased from 33.5% in the second quarter to 32.1% in the third quarter.
The youth unemployment rate decreased from 46.6% in the second quarter to 45.5% in the third quarter.
Informal sector employment increased by 165000 jobs. The largest increases in employment were recorded in community and social services, construction and trade.
Employment losses were recorded in finance with 189 000, with private households losing 32000 jobs, manufacturing losing 20 000 and 18000 jobs lost in the transport sector.
The largest increases in employment were observed in the Eastern Cape with 83 000 followed by 75000 in the Western Cape and 69000 in the North West. Decreases were observed in Gauteng and KwaZulu-Natal.
Bureau for Economic Research (BER) economist Nkosiphindile Shange noted that the labour force shrunk as more and more people became discouraged.
“Of the (net) 373000 reduction in unemployment, 294000 went to employment, but the 79000 became discouraged (stopped looking for work). Overall, discouraged workers increased by 160000.
“It is important to note that most of the jobs created were in the informal sector. Looking at the industries, manufacturing and finance or business services lost jobs: 21000 and 189000, respectively. The manufacturing sector also barely increased production on a quarterly basis, despite the absence of load shedding.
Of the jobs created, almost all were low-skilled; professional and technical occupations both lost 276000 jobs, and even skilled agriculture lost 37000 jobs,” said Shange.
He said while the unemployment rate remains stubbornly high the improvement was welcomed.
Senior research associate of the Southern Africa Labour and Development Research Unit (Saldru) at UCT, Andrew Donaldson said: “On balance this is encouraging news, particularly in the apparent growth in construction and trade.
This is the highest total employment number the QLFS has ever published.
But the third quarter increase in employment follows a decline in the second quarter, and brings total employment to just 1.2% more than a year ago ... whereas the labour force is 8% larger. Most of the increase over the past year is in informal jobs, so formal businesses are not yet expanding employment, and the outlook for young work seekers remains poor.
“Employment remains by far the most pressing policy challenge for the GNU.”
Deputy Minister in the Presidency, Nonceba Mhlauli said the results revealed a positive trend in the South African labour force. “This marks a significant step forward for our economy,” she said.
“It is fantastic to see the economy respond with such strong performance, but we also acknowledge that we have a lot more work to do to keep our economy growing to create even more jobs,” said Western Cape Premier Alan Winde.
Eastern Cape Premier Oscar Mabuyane said the upward trend was an indication of the province’s unwavering commitment to creating an enabling environment for job creation and stimulating economic growth.
Cape Times