SA employers report conservative hiring plans

South African employers have reported conservative hiring intentions for the January-March time frame in 2018.

WITH 15 percent of employers expecti ng to i ncrease staffing levels, 8 percent forecasting a decrease and 75 percent anticipating no change, the net employment outlook is 6 percent once the data is adjusted to allow for seasonal variation.

Lyndy van den Barselaar, managing director of ManpowerGroup SA, provides insights into why South African employers are reporting conservative hiring intentions for the January to March time frame.

“The local economy continues to struggle under economic and political uncertainty, low business and consumer confidence and a fluctuating currency.

“Therefore, it comes as no surprise that employers remain conservative in their spending and hiring patterns. That being said, the beginning of the year is often the time where businesses revisit their staffing strategies, and take on new hires - which could account for the small increase of 1 percent in the seasonally adjusted net employment outlook,” she said.

Regional comparisons

Payrolls are forecast to grow in four of the five regions during Q1 2018. Western Cape employers report the strongest hiring intentions with a net employment outlook of 10 percent, while some hiring opportunities are anticipated in Kwazulu-Natal, with an outlook of 6 percent.

Elsewhere, employers report modest hiring plans with Outlooks of positive percentages in both Eastern Cape and Gauteng. However, Free State employers forecast flat hiring activity, reporting an outlook of 0 percent.

When compared with the final quarter of 2017, hiring plans improve by 6 percentage points in Eastern Cape, and are 2 percentage points stronger in Western Cape.

However, the Free State outlook declines by 4 percentage points. Elsewhere, hiring plans remain relatively stable in both Gauteng and KwazuluNatal.

Employers report weaker hiring prospects in two regions when compared with this time one year ago. Free State employers report a moderate decline of 7 percentage points, while the outlook for the Western Cape is 2 percentage points weaker.

In Eastern Cape, Gauteng and Kwazulu-Natal, employers report relatively stable hiring intentions.

“The Western Cape continues to attract visitors and tourists in the first few months of the year, as the South African summer reaches its peak.

“This could continue to have a positive effect on hiring intentions among the province’s employers,” said van den Barselaar.

“Employers in the province continue to focus on job creation. For example, it was recently reported that the Cape Town International Convention Centre (CTICC) generated R216-million in revenue during the financial year ended 30 June 2017 - up from R209 million the previous year, and that due to the centre’s operations, 7 824 jobs were sustained in Cape Town and South Africa.

“The CTICC has already secured 58 major international events up until 2022, which could also be assisting with job creation in the coming months,” said van den Barselaar.

Sector comparisons

Employers in eight of the 10 industry sectors expect to increase staffing levels during first quarter 2018.

The strongest hiring pace is forecast in two sectors with Net Employment Outlooks standing at 12 percent - the Agriculture, Hunting, Forestry & Fishing sector and the Restaurants & Hotels sector.

Finance, Insurance, Real Estate & Business Services sector employers report cautiously optimistic hiring plans, with an Outlook of 9 percent, while Outlooks stand at 8 percent and 7 percent in the Public & Social sector and the Transport, Storage & Communication sector, respectively.

However, employers in two sectors expect payrolls to decline. Manufacturing sector employers report a sluggish Outlook of -9 percent, while the Construction sector Outlook is -2 percent.

“The need for further education and training, investment and development in the South African agriculture, forestry and fishing sectors has been gaining traction in recent months,” said van den Barselaar.

“The Department of Agriculture, Forestry and Fisheries just reported that 316 small-scale fishing communities have recently been registered along the South African coast. The plan is that in between December 2017 and March 2018 co-operatives will be established, registered and allocated rights in the Western Cape and Eastern Cape; and KwaZulu-Natal will follow in March 2018.”

Hiring plans improve in six of the 10 industry sectors when compared with the previous quarter. Agriculture, Hunting, Forestry & Fishing sector employers report the most notable increase of 13 percentage points, while Outlooks are 5 percentage points stronger in both the Mining & Quarrying sector and the Public & Social sector.

Meanwhile, hiring prospects weaken in four sectors, including the Manufacturing sector, with a considerable decline of 16 percentage points.

The Construction sector Outlook is 6 percentage points weaker, while Electricity, Gas & Water Supply sector employers report a decline of 5 percent- age points.

When compared with first quarter 2017, Outlooks decline in five of the 10 industry sectors. Considerable decreases of 20 and 13 percentage points are reported in the Manufacturing sector and the Electricity, Gas & Water Supply sector, respectively.

However, employers in four sectors report stronger hiring intentions, most notably in the Public & Social sector, with an increase of 6 percentage points, and in the Agriculture, Hunting, Forestry & Fishing sector, where the Outlook is 5 percentage points stronger. - bizcommunity.com