SA employers report encouraging hiring intentions for April-June time frame

OPPORTUNITIES for job seekers are expected to be strongest in the finance, insurance, real estate and business services sector and weakest within the electricity, gas and water supply sector.

Provincially, employers in the Western Cape report the strongest hiring intentions for the first quarter of the year, while employers within the Free State report the weakest hiring intentions.

Johannesburg, March 13, 2017, South African employers report encouraging signs for job seekers in the forthcoming quarter.

While 14% of employers expect to increase staffing levels, 5% anticipate a decrease and 80% forecast no change, resulting in a seasonally adjusted net employment outlook of +8%.

Hiring prospects improve by 2 percentage points when compared with the previous quarter and are also 2 percentage points stronger when compared with this time one year ago.

Lyndy van den Barselaar, managing director of ManpowerGroup SA provides insights into why South African employers are reporting encouraging hiring intentions for the April to June time frame: “While the economy is still weighed down by economic uncertainty, environmental factors such as the drought in the Cape and a fluctuating currency, business and consumer confidence seems to have improved with the consumer confidence index improving from -8 to -9 in the second quarter of 2017, and improving again in the fourth quarter.

“While the country still faces challenges in terms of repairing years of economic sluggishness, promises of policy certainty and consistency seem to have had a further positive effect on confidence and the strength of the economy thus far.

“These factors combined make for a more positive backdrop for employment in the country.” Regional comparisons Staffing levels are expected to increase in all five regions during 2Q 2018.

Employers report the strongest hiring prospects in Western Cape with an Outlook of +11% and in Gauteng where the Outlook is +10%.

KwaZulu-Natal employers forecast moderate hiring activity with an Outlook of +9% and the Outlook for Eastern Cape stands at +6%.

Meanwhile, the weakest hiring climate is anticipated in Free State where the Outlook is +1%.

When compared with 1Q 2018, hiring prospects are 5 percentage points stronger in Gauteng and improve by 2 percentage points in KwaZulu-Natal.

Elsewhere, employers report relatively stable hiring intentions in Eastern Cape, Free State and Western Cape.

Hiring plans weaken in Free State and Western Cape when compared with this time one year ago, with Outlooks declining by 7 and 2 percentage points, respectively.

However, Gauteng employers report an improvement of 6 percentage points, while Outlooks for Eastern Cape and KwaZulu-Natal remain relatively stable.

“As the Western Cape province continues to struggle under a debilitating drought, businesses are making large investments into securing water supply.

“It was recently reported that many firms in the province have already invested heavily into grey water systems, rainwater harvesting, boreholes and equipment to reduce water use.

“This is more than likely leading to the planned uptake in hiring in the province, as employment opportunities are being created through the provision of goods and services for alternative water supplies and saving.” Sector comparisons Payroll gains are anticipated in nine of the 10 industry sectors during the coming quarter.

The strongest labour market is forecast in the finance, insurance, real estate and business services sector, where the net employment outlook stands at +15%.

Elsewhere, a steady increase in staffing levels is expected by restaurants and hotels sector employers with an Outlook of +12% and by employers in two sectors with Outlooks of +11% – the manufacturing sector and the transport, storage and communication sector.

Public and social sector employers report modest hiring plans with an Outlook of +7%, while some payroll gains are forecast for the mining and quarrying sector, where the Outlook stands at +6%. Meanwhile, the Outlook of -1% for the electricity, gas and water sector reflects uncertain hiring prospects.

“As businesses in the country look to make smart decisions around their financial investments, take advantage of the economic improvements and invest wisely around environmental factors like the drought, finance, insurance, real estate and business services sector is gaining momentum.”

Hiring intentions improve in five of the 10 industry sectors when compared with the previous quarter.

The most noteworthy increase of 15 percentage points is reported in the manufacturing sector.

Finance, insurance, real estate and business services sector employers report an increase of 4 percentage points and the Outlook for the construction sector is 3 percentage points stronger.

However, hiring plans weaken in five sectors, most notably by 9 percentage points in the agriculture, hunting, forestry and fishing sector.

When compared with the second quarter of 2017, hiring prospects also strengthen in five of the 10 industry sectors.

The manufacturing sector Outlook increases by a considerable margin of 10 percentage points, while the Outlook for the finance, insurance, real estate and business services sector is 6 percentage points stronger.

Increases of 5 percentage points are reported in two sectors – the mining and quarrying sector and the restaurants and hotels sector.

However, Outlooks weaken in four sectors, including the electricity, gas and water sector with a decline of 12 percentage points and the wholesale and retail trade sector, where employers report a decrease of 6 percentage points.

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.

Payroll gains are forecast for all four organisation size categories during 2Q 2018. The strongest labour market is anticipated by large employers with a net employment Outlook of +18%.

Elsewhere, medium employers report steady hiring prospects with an Outlook of +11%, while Outlooks stand at +5% and +3% for small and micro-size employers, respectively.

Costella is account director: Lion’s Wing Brand Communications – South Africa

ManpowerGroup Employment Outlook Survey is available free at: http://www.manpowergroup. com/investors/alerts.cfm