Unemployment rises to 25.7%

29 July 2011

Unemployment in the second quarter of rose to 25.7 percent compared to the first quarter’s 25 percent, Statistics South Africa (Stats SA) reported on Thursday.

“The unemployment rate increased by 0.7 of a percentage point between quarter one (25 percent) and quarter two (25.7 percent),” Stats SA said on releasing its latest Quarterly Labour Force Survey.

The number of unemployed persons increased by 174 000 to 4.538-million people. The survey was conducted from April to June 2011.

“This is indication of an economy on a soft path and an uncertain global economy,” senior economist at Standard Bank, Johan Botha, said on Thursday.

According to the report, most job losses were in manufacturing, which shed 68 000 jobs, followed by mining (31 000) and trade (18 000).

“The story is discouraging for manufacturing in the second quarter, which reflects the global slowdown and the impact of the strong rand and rising cost pressures,” Nedbank senior economist Isaac Matshego said.

He added that the sector was facing pressure following recent strike action.

“We saw a recovery in this sector in the first quarter, but now it’s down again, which erases most of the gains in the sector,” Matshego said.

According to the survey, the number of people in the South African workforce increased by 181 000 between the first quarter and the second quarter to 17.7-million.

Formal sector employment contracted by 21 000 jobs, while work in the informal sector grew by 34 000 jobs.

“The number of unemployed persons increased by 174 000 between quarter one and quarter two, while the number of discouraged work-seekers decreased by 16 000 in the same period,” Stats SA said.

The biggest job losses between quarter one and two were recorded in Gauteng province (34 000), followed by North West at 31 000 and the Eastern Cape with 16 000 job losses.

Meanwhile, job gains were observed in KwaZulu-Natal at 71 000 and the Western Cape at 21 000.

Most of the formal sector job losses were in manufacturing (71 000) and mining (26 000).

Formal sector employment increased in the finance (44 000), transport (31 000) and community and social services (16 000) industries. This translated to a net loss of 21 000 jobs in the formal sector.

“The outlook is certainly clouded. It seems we are entering an extended period of relative weakness reflected by employment numbers,” said Botha.

Source: BuaNews