Good news as South Africa’s unemployment rate drops

New data shows that South Africa’s unemployment rate has declined from record highs of 27.7%, to 26.7% in the fourth quarter of 2017.

The results of the Quarterly Labour Force Survey (QLFS) for the fourth quarter of 2017 released by Statistics South Africa on Tuesday, indicate a decrease of 351,000 in the labour force in Q4:2017 with employment and unemployment decreasing by 21,000 and 330,000 respectively.

This resulted in a decline in the unemployment rate by one percentage point to 26.7%, StatsSA said. The absorption rate declined by 0.2 of a percentage point to 43.1% and the labour force participation declined by 1.1 percentage points to 58.8% quarter-to-quarter, the stats body said.

The expanded unemployment rate, which relaxes the requirement of job search to be classified as unemployed, declined by 0.5 of a percentage point from 36.8% to 36.3% at the national level between the 3rd and 4th quarters of 2017.

The data comes at a time when South Africa is seeking new direction under new leadership to drive economic growth which has stalled under the tenure of current president, Jacob Zuma.

Zuma however, is expected to be recalled ahead of his official term, and is set to be replaced with new ANC leader and national deputy president, Cyril Ramaphosa.

Should Ramaphosa take over as South Africa’s next president, he has stated publicly that he will use the NDP as his blueprint for achieving his goal of delivering 3% GDP growth in 2018, rising to 5% by 2023.

StatsSA said that formal sector employment declined by 135,000 while the informal sector employment increased by 119,000 compared to Q3: 2017.

Declines in Finance (91,000), Trade (45,000), private households (43,000), and Mining industries (35,000) contributed mostly to the net loss in employment.

However, employment was created in Community, social and personal services (75,000), Manufacturing (42,000), Agriculture (39,000), Construction (26,000) and Transport (13,000) in the same period.

Compared to the Q4:2016, employment increased by 102,000 or 0.6% while unemployment grew by 99,000 or 1.7 % in Q4:2017.

The largest decline in the unemployment rate was recorded in Northern Cape (2.8 percentage points), Western Cape (2.4 percentage points) and North West (2.3 percentage points). Between Q3: 2017 and Q4: 2017, the number of discouraged work-seekers grew by 103,000 (or 4.2%) to 2.5 million persons.

A decline in unemployment rate was observed across all age groups. Compared to adults the unemployment rate was highest among the youth irrespective of educational level. Approximately 3.1 million (29.7%) of the 10.3 million young persons (15-24 years) were not in employment, education or training, StatsSA said.

Read: Ramaphosa’s ‘fantastic plan’ to deliver 3% GDP growth in 2018

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Good news as South Africa’s unemployment rate drops