By Lee-Yandra Paulsen
South Africa has experienced a marginal decline in its official unemployment rate, dropping by 0.3% in comparison to the previous quarter. The most recent statistics, released by Statistician-general Risenga Maluleke, reveal the country’s unemployment rate now stands at 32.6%. This data encompasses the period spanning from April 1st to the end of June 2023.
Head of Research at Camissa Asset Management and Portfolio Manager of the Camissa Islamic funds, Abdul Azeez Davids spoke on VOC Breakfast on Wednesday, on the matter.
Davids highlighted the positive implications of the increased employment rate, Davids particularly emphasized the remarkable growth in the construction sector, which has generated a substantial number of job opportunities.
He attributed this growth to a surge in investments by companies and private households in self-sustained energy solutions like inverters and solar panels, significantly benefiting the construction industry.
Davids noted that other sectors, including trade, private households, and even mining to a minor extent, have also contributed to job creation. However, the statistics provided by Maluleke indicated a decline of 96,000 jobs in the manufacturing sector and 68,000 jobs in the finance sector. These secondary and tertiary sectors were notably affected.
“Job losses in these sectors can be linked to their sensitivity to interest rates. The South African Reserve Bank’s aggressive rate hikes in recent Monetary Policy Committee meetings have influenced these sectors negatively,” said Davids.
Furthermore, the newly released figures point to a gender disparity in employment. Women are shown to have a lower likelihood of securing jobs compared to men. Davids stated the historical and current wage disparity between genders, attributing this inequality to the types of industries women typically find employment in. Sectors such as mining, manufacturing, and construction—industries predominantly occupied by men—are seeing a growth in job opportunities, further exacerbating the gender imbalance in employment.
Addressing broader challenges in South Africa’s labour market, Davids expressed concerns about the scarcity of formal employment opportunities. He indicated that a significant portion of the country’s investment is directed toward export markets, leaving a gap in domestic job creation. Davids emphasized the importance of government intervention to incentivize opportunities for artisans and individuals who may not have pursued a university education.
South Africa’s incremental reduction in unemployment brings hope for economic recovery. While positive strides have been made in sectors such as construction, challenges remain in achieving gender parity and creating diverse employment avenues.
VOC News
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