The Eastern Cape has bucked a grim jobs trend in the latest quarter, recording an increase in employment.
SA’s official unemployment rate climbed 0.3 of a percentage point in the second quarter to 33.2% — its steepest level in a year, underscoring a sense that the government of national unity (GNU) has lost momentum on its jobs and growth mandate.
But increases in employment in Q2 were recorded in Gauteng (95,000) and the Eastern Cape (89,000).
Employment declines were reported in the Western Cape (117,000), KwaZulu-Natal (86,000) and the Northern Cape (28,000).
The overall uptick in unemployment, as shown in Stats SA’s quarterly labour force survey (QLFS) released late on Tuesday, was broadly anticipated given persistent economic pressures.
This comes amid a subdued domestic environment with growth of just 0.9% expected for the year.
Youth aged 15-34 remain particularly vulnerable. The number of unemployed youth rose by 39,000 to 4.9-million compared with Q1, while employed youth increased by 31,000 to 5.7-million.
The unemployment rate for women was 35.9%, up 0.4 of a percentage point from Q1. Black African women recorded an unemployment rate of 40.2%, higher than the national average, coloured women 23.5%, Indian/Asian women 17.9% and white women 8.8%.
“It’s much worse when you are young and you are a black African woman,” statistician-general Risenga Maluleke said.
Oxford Economics senior economist Jee-A Van Der Linde voiced a widespread fear that the 30% US import tariff, which kicked in on August 7, the Q3 numbers could reflect even more economic strain.
“Companies may feel compelled to scale back employment and investment plans in an uncertain landscape while trying to maintain competitiveness in the US market, which previously provided tariff-free access.”
The economy’s already fragile prospects have taken a further pounding from the US tariff wall, which, according to some estimates, is expected to lead to anything between 30,000 and 100,000 job losses.
The unemployment rate reflects a combination of factors, including “a persistent skills shortage, sluggish economic growth, poor productivity and a lack of fixed investment spending by the private sector as well as state-owned enterprises and the government”, Stanlib economist Kevin Lings said.
The weak labour market heaps pressure on the governing coalition, which has been locked in disputes, including ANC clashes with the DA over BEE, the budget and foreign policy.
The data comes several weeks after Stats SA’s methodology was thrust into the national spotlight with comments from the former Capitec CEO that the official numbers were worsening the country’s labour malaise.
In response, Stats SA will make refinements to the labour force survey questionnaire aimed at better capturing informal employment.
“We’ve been adhering to standards throughout, since the quarterly labour force survey (QLFS) started,” said Solly Molayi, Stats SA acting deputy DG responsible for population and social statistics.
“We are refining our measures to make sure we are measuring correctly and giving additional indicators.
"We are still measuring the informal sector as we’ve always measured it, with some refined measures.”
Molayi’s defence of the agency’s data sets was echoed by Maluleke, who asserted that informal sector data have always been part of Stats SA’s output.
“We will make a big mistake as a country if we want to assume we do not have an unemployment challenge... We have always made available the informal sector employment and unemployment numbers.”
Stats SA’s QLFS paints a picture of a fragile labour market where modest growth hides widening cracks as more people hunt for work and sectors bleed positions.
Even though there was a small uptick in employed people to just under 17-million, the number of unemployed people jumped to 8.4-million.
That left the overall labour force at 25.2-million, a modest 0.6% increase from the previous quarter.
The expanded unemployment rate decreased by 0.2 of a percentage point to 42.9% when compared with the first quarter. Formal sector employment increased by 34,000 in the second quarter, while informal sector employment fell by 19,000.
The number of discouraged job seekers fell by 0.8%. This resulted in a total decrease of 28,000 in the not-economically active population to 16.6-million.
BDLive
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