48 000 jobs lost so far this year
Trade industry shed most
SOUTH Africa continued to bleed jobs with the first quarter employment data released by Statistics SA (Stats SA) failing to ignite the ailing economy.
It said that the country slashed 48 000 jobs in the first quarter as gross earnings also declined by R19.3 billion during the period.
The agency said the trade industry shed the most jobs with 32 000 losses, followed by the business service with 23 000 less employees and community service also cutting 8 000 people out of employment.
It said the manufacturing industry also lost 4 000 jobs while transport shed 1 000.
Stats SA said the losses are attributed to the end of contracts for workers who were employed during the festive season.
It said the only notable difference was the construction industry which added 12 000 employees or an increase of 2 percent, while mining also took in 8 000 people – an 1.8 percent increase compared to the last quarter of 2016.
Investec economist Kamilla Kaplan said labour market prospects remained particularly weak after the country entered into a technical recession and business confidence tanked to levels last seen in the great global-led recession of 2008.
“Depressed business confidence reflects expectations of suppressed future economic growth which therefore indicates that the private business sector will not add jobs or boost investment at the present time. Indeed, recent survey evidence drawn from the retail and manufacturing sector surveys for the third quarter of 2017 signals further expected declines in the number of individuals employed,” Kaplan said.
Early this month, Stats SA revealed that the unemployment rate in South Africa increased to 27.7 percent in the first quarter of this year from 26.5 percent in the previous period – the highest jobless rate since the first quarter of 2004 as unemployment rose faster than employment.
Macroeconomic statistics website Trading Economics said unemployment in South Africa averaged 25.41 percent from 2000 until this year, reaching an all-time high of 31.2 percent in the first quarter of 2003 and a record low of 21.5 percent in the fourth quarter of 2008.
The loss of jobs in the first quarter of this year also hit the total gross earnings paid to employees after they went down by R19bn in the first three months of this year, a decrease of 3.2 percent compared to the previous quarter. However, this was still R33bn higher compared to the same period last year.
Total earnings paid to employees amounted to R588bn in March this year, down from R607bn in December last year.
The decreases in gross earnings were led by the manufacturing industry with employees losing out on R7.1bn in earnings; trade industry employees lost out on R6bn, while community services lost R4.5bn, closely followed by the construction industry with R4.4bn.
The employees in the transport industry lost out on R3.2bn and the electricity industry with R1.2bn. Industries that saw a quarter-to-quarter increase in gross earnings was the finance and business services industry with R6.8bn, an increase of 4.5 percent and mining industry with R5 million, a marginal increase of 0.02 percent.
There was a quarter-to-quarter increase of 0.8 percent in average earnings paid to employees in the formal non-agricultural sector, up from R18 536 in November last year to R18 687 in February this year.
On a yearly basis, the average monthly earnings paid to employees jumped by 8.3 percent from R17 262 last year to R18 687 in February this year.
Ian Cruickshanks, the chief economist at the South African Institute of Race Relations, said that said that unemployment would continue as economic structural reforms that were needed to create jobs were ignored or delayed.
A long queue waits outside the Johannesburg Road Agency headquarters, where people came to apply for a post that had been advertised at the institution. South Africa’s youth unemployment rates are now considered to be chronic.