South Africa’s biggest problems – according to South Africans

 ·15 May 2019

South Africa’s biggest problem, according to its citizens, is the stubbornly high unemployment rate, according to a survey published by Momentum.

And new data from StatsSA showed that the first quarter of 2019 experienced a rise in the country’s unemployment rate to 27.6% from 27.1%.

“With the fiscus under strain, the onus of employment growth lies heavily on the private sector, Momentum said, following the release of the latest data. “In Momentum Investments’ view, political uncertainty needs to abate and a recovery in domestic demand is required before firms can concentrate their efforts on hiring and investment again, it said.

The construction sector cut jobs by 142 000 in the first quarter of 2019, followed by the community and social services sector, which shed 50 000 jobs.

“Load shedding during the quarter likely contributed to the decline in number of employees that work on a contractual basis, Momentum said, noting that 124,000 jobs related to limited duration contracts were lost during the first quarter of 2019.

Skilled jobs, meanwhile, saw the largest increase in employment growth, while jobs at the non-skilled and semi-skilled levels experienced the largest declines.

Worryingly, youth unemployment rose to 55.2% in the first quarter of 2019, from 54.7% in the fourth quarter of 2018. “This is higher than SA’s peers and some European countries that also suffer with high levels of unemployment, Momentum Investments said.

“Consumer confidence among the youth declined significantly and went into negative territory in the first quarter of 2019 to negative 3 index points from 18 index points in the fourth quarter of 2018,” it said.

The International Monetary Fund (IMF) expects unemployment in the country to rise marginally and remain sticky around 27% between 2019 and 2020.

Momentum warned that while the rise in temp staff for the most recent national election could boost job numbers in the second quarter, “lingering uncertainty and suppressed domestic demand could continue weighing on hiring decisions.

The IMF said that structural reforms directed at product and labour markets are required to foster jobs.

Momentum’s Citizen Survey meanwhile, showed almost three in every four citizens listed unemployment as the largest problem in South Africa.


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