South Africa’s unemployment rate increased to 25.5% in the third quarter of 2015

Posted On Tuesday, 27 October 2015 19:35 Published by
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South Africa’s unemployment rate increased to 25.5% in the third quarter of 2015, Statistics South Africa (Stats SA) said on Tuesday.

Kefiloe_Masiteng

“Unemployment has slightly increased,” Statistics South Africa’s Deputy Director General for Population and Social Statistics, Kefiloe Masiteng, said at the release of the Quarterly Labour Force Survey (QLFS) for the third quarter of 2015.

In the second quarter, unemployment fell to 25%.

According to the third quarter’s QLFS, the country’s working age population was at 36.1 million (aged between 15 to 64 years) with 15.8 million people being employed, 5.4 million people being unemployed and 14.9 million not economically active.

“The not economically active population decreased by 200 000 and the economically active population increased by 359 000 quarter-on-quarter. This resulted in an unemployment rate of 25.5%, absorption rate of 43.8% and labour force participation rate of 58.8%,” noted the report.

The absorption rate of 43.8% observed in the third quarter is still below the pre-recession rate (46.2% in quarter four of 2008).

In the third quarter, the formal sector accounted for the largest share of employment at 69.1%, agriculture accounted for the lowest share at 5.7%, while 15% of the not economically active population was accounted for by the discouraged.

Employment gains were largely seen in the trade (at 81 000) and construction (59 000) industries while the number of people employed in the mining industry remained unchanged between the two quarters.

The survey, which polls households, showed that job losses were recorded in the transport, private households, utilities and finance industries at (24 000, 11 000, 9 000 and 4 000 respectively). The youth unemployment rate was the lowest amongst graduates at 9.2%.

According to the QLFS, enquiring at work places was the most used method of job searches.

In a research note earlier today, Standard Bank economists said they expected the unemployment rate to increase marginally.

“The unemployment rate has oscillated around the 25% mark since 2012. We anticipate the labour market to remain constrained into 2016 as declining commodity prices and strained labour relations keep the mining sector under severe pressure. The manufacturing sector has already started shedding jobs, adding to the stricken labour market,” said the economists.

Meanwhile, Nedbank economists said that both domestic and international macroeconomic factors remain unfavourable to support sustainable employment growth. The unemployment rate is therefore likely to remain high in the short-term.

“The rise in the unemployment rate provides further evidence that underlying economic conditions remain weak. The outlook is also bleak and paints a poor picture for employment creation in the short-term.

“However, we still believe that the Reserve Bank will probably raise rates at the November meeting ahead of a likely US rate lift off in December. We expect the main part of this hiking cycle to be in the first half of 2016, as the MPC [Monetary Policy Committee] responds to rising inflation and interest rate normalisation in the US,”  said Nedbank economists.

Last modified on Tuesday, 27 October 2015 20:34

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