These are the sectors that will be hiring in 2021 – and where in South Africa they’re looking

 ·30 Dec 2020

South African employers will be proceeding with caution when it comes to hiring in the first quarter of 2021, according to the latest ManpowerGroup Employment Outlook Survey.

While some hiring activity will be taking place – around 11% of employers forecast an increase in payrolls – staff levels are expected to remain largely the same, with 76% of companies surveyed expected to make no changes.

However, job cuts are still on the cards, the group warns, with 9% of companies surveyed anticipating a decrease in payroll.

Once the data is adjusted to allow for seasonal variation, the overall outlook for South Africa comes out positive, standing at +2%.

Hiring sentiment is considerably stronger when compared with the previous quarter, improving by 14 percentage points, ManpowerGroup said. In comparison with this time one year ago, hiring prospects are unchanged as the outlook returns to pre-Covid-19 levels following consecutive gloomy forecasts.

“As we look forward to the first quarter of 2021, the South African economy is showing signs of some recovery, at least on the employment outlook front,” said Lyndy van den Barselaar, Managing Director of ManpowerGroup SA.

“This year has been challenging in the extreme for many businesses, particularly smaller ones, which are still struggling; however, larger businesses are showing positive employment growth. While we are not in the clear in terms of the impact of Covid-19 on the economy and employment, employers are adjusting and adapting more easily, and taking advantage of new ways of doing business.”

Regional Comparisons

Employers in three of the five regions expect to grow payrolls during the first quarter of 2021.

The strongest hiring prospects are reported in Gauteng, where the Net Employment Outlook stands at +6%.

Outlooks of +2% and +1% are reported in Western Cape and Eastern Cape, respectively.

However, employers expect to trim payrolls in Free State where the Outlook is -6%, and in KwaZulu-Natal with an Outlook of -3%.

Hiring plans strengthen in all five regions when compared with the previous quarter, most notably by a steep margin of 24 percentage points in Gauteng.

The KwaZulu- Natal Outlook is 11 percentage points stronger, while Outlooks increase by 7 percentage points in both Eastern Cape and Western Cape.

In a comparison with the same period last year, hiring prospects improve by 10 percentage points in Eastern Cape and by 3 percentage points in Gauteng. However, Outlooks are 7 and 3 percentage points weaker in KwaZulu-Natal and Free State, respectively.

“With international travel and trade severely restricted by the global pandemic, many sectors will remain subdued, such as tourism. This has a significant impact on regions that focus heavily on any one sector that has been impacted strongly,” said van den Barselaar.

“This is why we expect to see stronger growth in the regions where finance and business services prevail – e.g. Gauteng, with the strongest regional Outlook.”

Sector Comparisons

Workforce gains are expected in four of the seven industry sectors during the forthcoming quarter.

The strongest hiring prospects are reported in the Finance & Business Services sector, where the Net Employment Outlook is +7%, and in the Manufacturing sector with an Outlook of +5%.

Elsewhere, employers in the Wholesale & Retail Trade sector and the Other Production sector forecast limited hiring activity, with Outlooks of +2% and +1%, respectively.

Flat labour markets are anticipated by employers in both the Other Services sector and the Restaurants & Hotels sector, reporting Outlooks of 0%.

However, Construction sector employers anticipate a gloomy hiring climate with an Outlook of -12%.

Hiring sentiment strengthens in all seven industry sectors when compared with the previous quarter.

Construction sector employers report the most notable increase of 16 percentage points, while Outlooks are 15 and 14 percentage points stronger in the Manufacturing sector and the Other Production sector, respectively.

In the Finance & Business Services sector, employers report an improvement of 13 percentage points, while the Restaurants & Hotels sector Outlook is 11 percentage points stronger.

In a comparison with last year at this time, Outlooks improve in three of the seven industry sectors, including increases of 3 percentage points for the Other Services sector and 2 percentage points for the Manufacturing sector.

However, hiring prospects also decline in three sectors, by 4 percentage points for the Restaurants & Hotels sector and by 3 percentage points for both the Construction sector and the Wholesale & Retail Trade sector.

“The changes in how we do business that were forced upon the world earlier in 2020, such as work from home, have had significant knock-on effects in various industries. Construction plans have been postponed or stopped, for example,” van den Barselaar said.

“Other industries will recover faster and more easily, while services we have come to recognise as essential will continue to grow, such as retail and wholesale. We have yet to see how the employment landscape will be reformed post-Covid-19, but for now, we can expect some positive employment outlooks, and some negative.”

Organisation-Size Comparisons

Participating employers are categorised into one of four organisation sizes: Micro businesses have less than 10 employees; Small businesses have 10-49 employees; Medium businesses have 50-249 employees; and Large businesses have 250 or more employees.

Large- and Small-size employers expect to grow payrolls during the upcoming quarter, reporting Net Employment Outlooks of +10% and +4%, respectively.

However, Medium employers expect to trim payrolls, reporting an Outlook of -3%, and the Outlook for Micro firms stands at -2%. Hiring prospects strengthen in all four organisation size categories when compared with the previous quarter.

A sharp improvement of 34 percentage points is reported by Large employers, while the Outlook for Small firms is 20 percentage points stronger.

Elsewhere, Micro- and Medium-size employers report increases of 5 percentage points. When compared with the first quarter of 2020, hiring plans decline by 10 percentage points for Large employers and by 3 percentage points for Medium employers.

Meanwhile, the Outlook for Micro firms is unchanged and Small employers report an improvement of 7 percentage points.

Read: To rebuild South Africa’s economy, let’s repatriate our jobs

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