Here’s who will be hiring in South Africa at the beginning of 2020

 ·10 Dec 2019

The ManpowerGroup has published its latest employment outlook survey, showing that South African employers have ‘soft’ hiring intentions in Q1 2020.

The group’s data shows that while 10% of employers forecast an increase in payrolls, 8% anticipate a decrease and 81% expect to make no changes.

Once the data is adjusted to allow for seasonal variation, the outlook stands at +2%, and is the weakest reported in more than five years.

Hiring plans remain relatively stable when compared with the previous quarter, but declined by three percentage points in comparison with the same period last year.

“As we move into the new year, the South African economy continues to be affected by subdued economic growth and a sluggish growth outlook,” said Lyndy van den Barselaar, managing director of ManpowerGroup SA.

“Policy uncertainty and a high unemployment rate remain a deep concern for local businesses who are looking to the new year with caution when it comes to their spending and hiring strategies.”

Who will be hiring?

Employers in six of the 10 industry sectors expect to increase payrolls during the forthcoming quarter.

The strongest hiring pace is forecast in the Finance, Insurance, Real Estate & Business Services sector, where the net employment outlook stands at +9%.

Some hiring opportunities are expected in the Wholesale & Retail Trade sector and the Agriculture, Hunting, Forestry & Fishing sector, with outlooks of +7% and +5%, respectively, while the Restaurants & Hotels sector outlook is +4%.

Meanwhile, employers in three sectors expect to trim payrolls, most notably reflected in outlooks of -9% for the Construction sector and -6% for the Transport, Storage & Communications sector.

“As businesses in South Africa look to digital transformation to shift the way they see and do business, the country moves toward becoming part of the Fourth Industrial Revolution (4IR). These kinds of changes are spurred by the Business Services sector.

“Additionally, as businesses and individuals look to make better financial decisions in a challenging economic climate, the Financial Services and Insurance sectors will become more prevalent. It is possible that these factors are contributing to the expected growth in the sector,” said van den Barselaar.

Hiring sentiment weakens in eight of the 10 industry sectors in a comparison with the final quarter of 2019. Public & Social sector employers report the most noteworthy decline of six percentage points, while outlooks are five and three percentage points weaker in the Construction sector and the Restaurants & Hotels sector, respectively.

Elsewhere, decreases of two percentage points are reported in three sectors ꟷ the Finance, Insurance, Real Estate & Business Services sector, the Manufacturing sector and the Transport, Storage & Communications sector.

However, Wholesale & Retail Trade sector employers report a quarter-over-quarter improvement of 4 percentage points.

Where will they be hiring?

Employers in three of the five regions expect to add to payrolls in the first quarter of 2020.

The strongest labour market is anticipated by Western Cape employers, who report a net employment outlook of +4%. Limited job gains are also forecast in Gauteng and Kwazulu Natal, with Outlooks of +3% and +2%, respectively.

However, Eastern Cape employers report downbeat hiring prospects with an outlook of -5%, while the Free State Outlook stands at -1%.

“The Western Cape government continues to focus on development in the region through several initiatives, such as one initiative that is focusing on diversifying the province’s energy mix through an uptake in sustainable energy sources,” said van den Barselaar.

“This could create employment for those with skills in developing, installing and maintaining these sustainable energy sources such as solar photovoltaic panels, for example.

“Another provincial initiative looks to encourage direct engagement between the  government and the private sector, with sectors such as construction, manufacturing, IT, business process outsourcing and transport participating.

“These kinds of initiatives look to spur growth and promote job growth, which could contribute to the positive outlook for the province in the coming quarter.”

Eastern Cape employers report a considerable decline of 13 percentage points when compared with the previous quarter, and outlooks also weaken by 5 and 3 percentage points in Free State and KwaZulu Natal, respectively.

Elsewhere, hiring prospects remain relatively stable in Gauteng and Western Cape.

Compared to this time one year ago, Eastern Cape employers report a decline of 14 percentage points.

Hiring plans also weaken by 4 percentage points in Gauteng and by 3 percentage points in the Western Cape. Meanwhile, the Outlook for KwaZulu Natal remains relatively stable and Free State employers report no change.

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