Mon. May 20th, 2019

Stats SA: South Africa’s unemployment rate rises to 26.7%

unemployment rate stats saThe growth was shortlived, says Stats SA.

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Statistics South Africa (Stats SA) released its quarterly labour force survey for the first quarter (Q1) of 2019, on Tuesday, and it shows a grim picture of the country’s limping unemployment rate.

Stats SA: Unemployment rate rises as expected

According to the survey, South Africa’s unemployment rate currently sits at 27.6%, a 0.5 percentage-point increase from the data collected for the fourth quarter (Q4) of 2018.

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Market analysts predicted this slump at the beginning of the year when Stats SA released Q4’s figures, which showed a labour market spurt in growth.

According to Annabel Bishop, a group economist from Investec, the decrease in employment is the eventuality of traditional increased economic behaviour during the festive season.

“The December and festive season tend to see more additional employment from retailers, from shop assistants and obviously the tourism sector as well and that tend to see a little bit of mild improvement. We’re not expecting to see a dramatic improvement.” she had said in February.

Related: Expected unemployment rate decrease boosted by festive activity in South Africa

Her words and that of many labour market sceptics rang loud when Stats SA proved this to be somewhat true in the latest survey.

Key findings in latest labour market survey

In Q1, the number of employed persons dropped by 237 000 to 16.3-million, while the working-age population (eligible workers defined in the Labour Act) grew by 605 000 (1.6%).

Moreover, compared to Q4:2018, the total number of unemployed persons grew by 62 000 to 6.2-million, causing a significant decrease (down by 176 000 or 0.8%) in the number of people currently active in the labour market.

“The absorption rate decreased by 0,7 of a percentage point to 42,6% and the unemployment rate increased by 0,5 of a percentage point to 27,6% compared to the fourth quarter of 2018.”

Job losses were felt the most in the formal sector, with a decline of 126 000. Take a look at these significant losses in other sectors:

  • Informal sector (68 000);
  • Private households (31 000); and
  • and Agriculture (12 000)

Related: Why South Africa should seriously consider taxing its wealthy citizens

SA’s labour force on shaky grounds

A scary picture of South Africa’s economic standing is developing. Not only is South Africa’s labour market unable to maintain stability, but it also is not encouraging anyone to participate in it.

For Q1:2019, the total number of discouraged work-seekers grew by 156 000, while the number of people not currently active in the economy for reasons other than discouragement increased by 169 000.

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