The one province in South Africa where more people are unemployed than working – with another at a tipping point

When factoring in discouraged work seekers, the North-West province has more unemployed people than working, and the Eastern Cape is right behind it.

South Africa’s unemployment rate trended upward in the second quarter of 2024 as tough economic and business conditions continued into 2024.

The latest Quarterly Labour Force Survey (QFLS), published by Statistics South Africa on Tuesday (13 August), shows that the official unemployment increased by 0.6% from 32.9% in Q1 2024 to 33.5% in Q2 2024.

According to the data, the number of unemployed persons increased by 158,000 to 8.4 million during the same quarter.

Discouraged work seekers also increased by 147,000 (up by 4.8%).

Additionally, the number of people who were not economically active for reasons other than discouragement decreased by 75,000 (down by 0.6%) between Q1 and Q2.

The national stats service noted that this resulted in a net increase of 72,000 in the not economically active population.

The industries that contributed to the net employment decline include Trade (-111,000), Agriculture (-45,000), Private households (-18,000), Construction (11,000) and Finance (-9,000).

However, Manufacturing (+49,000), Community and social services (+36,000), and Utilities (+9,000) recorded the largest employment gains.

Provincial performance

Provincially, employment losses were recorded in the Eastern Cape (-111,000), Limpopo (-40,000), North West (-30,000) and Northern Cape (-2,000).

Compared to Q3 2023, the largest employment increase was recorded in KwaZulu-Natal (+62,000), followed by Mpumalanga (+48,000) and Western Cape (+23,000) during the same period.

The provinces with the most employed

According to the latest data, the Western Cape has the lowest unemployment rate (standard definition) in South Africa at 22.2%, meaning it has the most people working versus unemployed in the country.

This is then followed by Kwa-Zulu Natal (31.1%), Limpopo (31.4%), and Northern Cape (32%).

Additionally, the Western Cape is the only province that has consistently been well below the South African average official unemployment rate over the past ten years, with KZN toeing the line.

By contrast, over the last ten years, the Eastern Cape has consistently been above the average official unemployment rate.

However, the situation is much worse for most provinces when considering the expanded definition of unemployment—which includes discouraged work seekers.

The extended unemployment rate in South Africa’s provinces ranges from 27.3% to 54.2%, with the Western Cape being the only province with a rate below 30% on the expanded definition.

One province – the North West – has more adults out of work and not looking than people who are employed, with an unemployment rate of 54.2%.

However, the Eastern Cape is at a tipping point and could soon join the North West, as its unemployment rate is 49.7%.

Over the last few quarters, the unemployment numbers have worsened for the Eastern Cape.

It’s important to note that the Eastern Cape is the only one of South Africa’s nine provinces currently in a recession, which is causing the province to be dangerously close to having more people unemployed than working.

The Eastern Cape Socio-Economic Consultative Council (ECSECC) reported that while South Africa’s economy contracted in the first quarter of 2024, some provinces were hit harder by poor economic conditions than others.

Overall, the South African economy shrank by 0.1% in the first quarter of 2024, down from the 0.3% growth recorded in the previous quarter and lower than the 0.9% rate projected by the IMF for 2024.

Additionally, comparing year-on-year, the national GDP decreased by 0.7 percentage points from 0.6% in the first quarter of 2023. Although most provinces experienced economic contractions, the Eastern Cape’s economy contracted for the third consecutive quarter, officially entering into a recession in the first quarter of 2024.

The provincial economy declined by 0.3% in 2024Q1, following contractions of 0.1% and 0.3% in 2023Q4 and 2023Q3, respectively.

The Eastern Cape’s GDP, at market prices, declined from R368.8 billion in 2023Q4 to R366.9 billion in 2024Q1.

In comparison to other provinces, the Eastern Cape accounted for 7.9% of the national GDP, while Gauteng (33.9%), KwaZulu Natal (16.6%), and Western Cape (14.2%) were the largest contributors.

Only two industries in the Eastern Cape, agriculture and electricity, experienced positive growth.

The largest negative contributors to the decline in GDP in the first quarter were construction (down by 2.9%), manufacturing (down by 1.5%), mining (down by 1.2%), and transport (down by 0.7%).

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