South Africa faces an unemployment disaster

Although South Africa’s unemployment rate improved slightly at the end of 2024, it is significantly lower than it was a year ago.

Stats South Africa’s Quarterly Employment Statistics survey found that after a challenging year of job losses, South Africa’s formal non-agricultural sector improved slightly in the fourth quarter of 2024, growing by 12,000 jobs.

As a result, employment reached 10.64 million by December 2024, a 0.1% increase from the third quarter of 2024.

However, the picture looks worse than it did a year ago. From December 2023, jobs declined by a notable 91,000.

Although the official unemployment rate decreased by 0.2% to 31.9% in the fourth quarter of 2024 compared to the third quarter of 2024, the number of “not economically active” South Africans reached a notable 16.5 million people during the quarter.

This number also increased from the fourth quarter of 2023, which reached 16.4 million.

Discouraged workers made up 3.5 million of the people in this group in Q4 2024, a notable uptick compared to 3 million at the end of 2023.

Importantly, according to StatsSA’s latest mid-year population estimates for 2024, South Africa’s population has now exceeded 63 million.

The country’s population grew by approximately 835,513 individuals, marking a 1.33% increase from July 2023 to July 2024.

This means that even if South Africa’s employment rate continues to increase by 0.1%, it will not be nearly enough to keep up with the country’s population growth.

If the employment rate keeps declining year-on-year, as it did from 2023 to 2024, the situation will become even worse for South Africans.

Sectors with the most job losses

According to Stats SA, the trade industry led the increase from Q3 to Q4 2024, adding 42,000 jobs, with business services following with 22,000 new jobs.

Not all sectors shared these gains, though. For example, the community services industry experienced the largest decline, shedding 26,000 jobs, while construction and manufacturing each lost 13,000.

Full-time employment in the country saw an increase of 10,000 jobs in the final quarter of 2024, rising from 9.48 million to 9.49 million in the fourth quarter, according to the latest employment data.

Several industries contributed to this growth, with the trade sector leading the way by adding 24,000 full-time positions.

The business services industry followed closely, expanding its workforce by 21,000 jobs. Modest increases were also recorded in the transport and electricity sectors, which added 3,000 and 1,000 jobs, respectively.

Not all industries shared in this growth.

The construction sector saw a significant decline, shedding 14,000 full-time jobs. The community services industry followed with a loss of 12,000 jobs, while the manufacturing sector reduced its workforce by 10,000 jobs.

Meanwhile, the mining industry reported a decline of 3,000 full-time positions.

Despite the quarterly increases, full-time employment remains lower than it was a year ago. Between December 2023 and December 2024, the number of full-time jobs fell by 26,000.

Part-time employment also experienced a slight uptick, increasing by 2,000 jobs from 1.151 million in September 2024 to 1.153 million in December 2024.

This growth was mainly driven by the trade industry, which added 18,000 part-time positions. The business services and construction sectors each contributed an additional 1,000 jobs.

However, other industries struggled to maintain their part-time workforce.

The community services sector recorded the largest decline, losing 14,000 jobs. The manufacturing industry shed 3,000 part-time positions, while the transport sector reported a decrease of 1,000 jobs.

Year-on-year, part-time employment experienced a sharp decline, with 65,000 fewer jobs compared to the same period in 2023.

While the latest figures indicate short-term gains in both full-time and part-time employment, the overall labour market continues to face challenges, particularly when compared to the previous year’s performance.