The South African economy has recorded a notable shift in employment trends, with the official unemployment rate decreasing to 32.1% in the third quarter of 2024.
According to the Quarterly Labour Force Survey (QLFS) results released recently, this reflects a positive shift as the number of employed persons increased by 294,000, reaching a total of 16.9 million.
It is revealed that this rise is coupled with a notable reduction in unemployment, with 373,000 fewer individuals classified as unemployed, bringing the total to 8.0 million.
Despite an overall decrease of 79,000 in the labour force, it is reported that the landscape remains challenging, especially for specific demographics.
Notably, the data shows a rise in discouraged job seekers, a concerning statistic that increased by 160,000 (5.0%) during the same period.
Additionally, the number of individuals who remained economically inactive for reasons other than discouragement also expanded by 54,000, resulting in a total of 16.5 million not actively participating in the labour market.
The expanded unemployment rate, which encompasses a broader definition of joblessness, also saw a decline, falling by 0.7 percentage points to 41.9%.
The formal sector witnessed an increase of 122,000 positions, while the informal sector saw an even stronger rise, with an addition of 165,000 jobs.
The greatest boosts in employment were found within the Community and Social Services sector (194,000 jobs), construction (176,000), and trade (109,000).
However, it is reported not all sectors fared equally.
The finance sector saw the most pronounced decrease in employment, losing 189,000 jobs, followed by losses in private households (32,000), manufacturing (20,000), and transport (18,000).
Geographically, the greatest employment growth occurred in the Eastern Cape (83,000), Western Cape (75,000), North West (69,000), and Mpumalanga (49,000). In contrast, Gauteng experienced a decrease of 66,000 jobs, along with a slight drop in Kwa-Zulu Natal (2,000).
It is further revealed that the significant area of concern remains the youth population, aged 15 to 34 years, who continue to face vulnerabilities in the labour market.
Though there was a decrease in unemployed youth by 171,000—bringing the total to 4.8 million—employed youth also saw a modest increase of 66,000, resulting in a total of 5.8 million.
This shift led to a decline in the youth unemployment rate, which dropped from 46.6% in the previous quarter to 45.5%.
While the reduction in unemployment figures presents a glimmer of hope for South Africa's economy, the increase in discouraged job seekers and ongoing struggles within certain sectors paint a more nuanced picture.
Meanwhile the ANC has welcomed the slight decrease in the unemployment rate, stating it is committed to economic transformation and alleviating the harrowing poverty rate.
The party’s national spokesperson Mahlengi Bhengu-Motsiri said the decline in the unemployment rate is a milestone, as the party is mandated to counter joblessness according to its party manifesto.
“The QLFS findings affirms the ANC commitment to implementing national conference resolutions that prioritise economic growth through job creation, poverty reduction, and increased participation of the African majority, especially youth and women in the economy,” said Bhengu-Motsiri.
ActionSA MP, Alan Beesley, predicted the unemployment rate is likely to worsen.
“These numbers, while showing a slight improvement compared to the previous quarter, still paint a picture of an enormous employment crisis.
“This number falls far short of ActionSA’s GNU Performance Tracker labour force participation rate target of 65%, highlighting the country’s ongoing unemployment crisis,” said Beesley.
He raised concern that the country’s economy is lagging compared to other third world countries.
“South Africa’s economy is simply not growing and as such is unable to create jobs. The National Treasury has forecasted a growth rate of 1.1% for 2024, following only 0.4% growth in the first half of the year, with an average projection of 1.8% over the next three years.
“In contrast, emerging markets and developing countries are growing at 4.2% on average, while Sub-Saharan Africa is expected to grow at 3.6%. South Africa is lagging behind its peers and even many developed countries. Given our population growth rate of 1.3%, this sluggish economic growth means that unemployment is likely to get worse,” said Beesley.
EFF’s national spokesperson Leigh-Ann Mathys echoed Beesley’s words, noting there is a stagnant economic growth.
“This stark increase highlights the deepening disillusionment and economic exclusion under the current government, which has utterly failed to stimulate meaningful economic activity and job creation,” said the EFF.
She further claimed that there was little economic change in the first 100 days of the “DA-ANC grand coalition” under the Government of National Unity.
The Star