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As the economy continues to grow, South Africans are asking "Where are the jobs"?

South Africa is currently recovering from a deep recession, with positive GDP growth numbers, but even with this economic growth, the country continues to shed jobs in the formal sector and is failing to create employment. Over the past nine months, about 742 000 jobs were lost.

Of those, 660 000 were lost in the third quarter alone, making the current unemployment rate the highest since the start of the QLFS in 2008.

Statistician-General Risenga Maluleke said the QLFS shows that the number of unemployed people has increased in the country’s three largest provinces. KwaZulu-Natal and Gauteng account for about half of the 660 000 jobs lost in this quarter.

Duma Gqubule, economist and founding director of the Centre for Economic Development and Transformation, described the latest unemployment statistics as “a horror”. Gqubule said that, according to Stats SA, 12.5 million South Africans were unemployed.

He added that, by the time the next national elections are held in 2024, South Africa’s expanded unemployment rate will be above 50%. And it seems the government does not have any plan to counter this, he said.

PwC chief economist Lullu Krugel said that, following the loss of 2.2 million employment opportunities in the second quarter of last year, about a third of these jobs were recouped during the second half of last year due to the easing of Covid-19 lockdown restrictions.

Krugel said formal employment declined from 10.495 million in the last quarter of last year to 10.2 million in the second quarter of this year, a net loss of nearly 300 000 formal jobs during the first half of this year.

“This is a staggering number. On an industry level, 444 054 jobs were lost from the first to the second quarter of this year,” said Krugel.

She added that these jobs were lost in the service sector, which continues to experience significant pressure on income and employment levels, as businesses and consumers reduce spending on nonessential services. She said that, because of the expected higher growth figures, many analysts were waiting for this year to see actual job creation.

This year alone, the economy grew by 5%, but this growth had not translated into jobs.

According to Absa analyst Sello Sekele, the bank estimated the GDP growth at 5.1% overall this year. PwC forecast GDP growth of between 1.5% and 3.0% next year but said the country’s outlook was uncertain at best, and that the pace of jobs recovery will continue to be slow. Krugel said PwC had created a GDP model showing that, at the end of 2019, a one percentage point increase in real GDP would translate to a 1.01 percentage point increase in employment. In the second quarter of this year, the model showed that a one percentage point increase in real GDP only translated to a 0.91 percentage point change in job creation.

So where are the jobs if the economy is growing but unemployment continues to rise?

Content created and supplied by: MBCNetwork (via Opera News )

Gauteng KwaZulu-Natal Risenga Maluleke South Africa South Africans


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