By Thanda Sithole
The Quarterly Labour Force Survey (QLFS), a household-based employment survey (not seasonally adjusted), showed an increase in employment during 3Q24 by 293 840 q/q, completely offsetting the 92 416 jobs lost in 2Q24. Unemployment fell by 373 305 q/q, bringing the total number of unemployed individuals to 8 010 520. The official unemployment rate was 32.1% in 3Q24, reflecting a decrease from 33.5% in 2Q24 (Figure 1). Youth unemployment remains critically high at 60.2% for the 15 to 24 age group, and 40.4% for the 25 to 34 age group, underscoring the urgent need for pro-growth structural reforms to spur economic expansion, particularly in high-employment multiplier sectors like construction (Figure 2).
Sectoral employment insights:
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Public sector: Employment in the community and social services sector increased by 194 285 q/q (but fell by 62 334 y/y) to 4 021 496, with the y/y decline reflecting large employment decreases in the education sector. While public-sector employment remains relatively stable, it is under pressure from fiscal constraints and efforts to curb government spending. Notably, to manage public-sector wage bill pressures, the government has allocated R11 billion over the next two fiscal years for early retirement programmes.
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Private sector: Jobs in the formal non-agricultural sector (excluding the formal public services) decreased by 6 278 q/q (but expanded by 57 594 y/y) to 8 154 208. Nevertheless, hiring generally remains subdued amid sluggish "non-renewable" investment and manufacturing activity (Figure 3). Quarterly net job increases were observed in the construction (176 452 q/q), wholesale and retail trade, motor trade and hospitality (108 838 q/q), mining (27 304 q/q, largely gold sub-sector) and electricity, gas, and water (13 336 q/q) sectors. Meanwhile net job losses were recorded in the financial intermediation, insurance, real estate, business services (189 066 q/q), manufacturing (20 190 q/q), as well as transport, storage, and communication (17 917 q/q) sectors.
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Agricultural and informal sectors: Employment in agriculture rose by 39 035 q/q (but fell by 20 631 y/y) to 934 959, as economic activity in the sector remains subdued. However, the recent increase in the Agbiz agribusiness confidence index suggests potential near-term improvement. Informal employment, a crucial source of income for many South Africans, was estimated at 3 294 567 in 3Q24, reflecting an increase of 165 234 q/q and 236 806 y/y.
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Private households: Employment in private households decreased by 32 398 q/q (but increased by 12 300 y/y) to 1 127 825. Jobs in this sector remain constrained as the cost of living has consistently outpaced wage-income growth since 4Q19.
Outlook
The subdued labour market underscores the challenges of weak economic growth outcomes and subdued business confidence. Although energy constraints have eased, the economy remains hampered by structural constraints in other critical network industries, including weak infrastructure investment and poor service delivery at a local government level. We anticipate economic growth to rise by nearly 2.0% over the next two years, supporting modest employment gains. However, we remain adamant that robust and sustainable economic growth will be needed to boost employment meaningfully.
