February 2014 – ECONOMY – South Africa’s unemployment rate eased to 24.1% in the fourth quarter of 2013 from a revised 24.5% in the third quarter, Statistics South Africa (Stats SA) reported on Tuesday. Releasing its Quarterly Labor Force Survey, Stats SA said the number of jobs had increased by 141 000 in the quarter, largely due to an increase of 123,000 jobs in the informal sector and 64,000 jobs in the formal sector. Most of the increase was among people with temporary and short-term contracts, Stats SA said, adding: “Despite the rise in employment numbers, the proportion of working-age South Africans with jobs, at 43.3%, is still below the pre-recession peak of 46.2% observed in quarter four of 2008.” Informal non-agricultural sector jobs increased by 123 000 over the fourth quarter, while formal sector non-agricultural jobs increased by 64, 000. Over the course of the quarter, the agricultural sector and private households shed 27,000 and 20,000 jobs. The number of unemployed people decreased by 50,000 over the period, while the labor force grew by 91,000.
Nedbank economists, commenting on the latest figures, said South Africa’s unemployment rate was unlikely to be reduced significantly in the short term given weak domestic demand, rising input costs, labor disputes, significant infrastructure constraints and other regulatory issues in some key sectors. The figures suggest that the country’s weak economy is still struggling to reduce the unemployment rate significantly, the bank said in a research note. “The growth outlook is still fragile. At the same time, recent other indicators suggest that inflation is still contained, but the outlook has deteriorated due to the weaker rand. In order to contain the inflationary pressures, we anticipate that the Reserve Bank will raise rates once more in March before keeping them on hold well into 2015.” The Reserve bank raised the repo rate by 50 basis points to 5.5% in January. Stats SA’s Quarterly Labor Force Survey is a household-based sample survey that gathers data on the labor market activities of individuals aged 15 and above who live in South Africa. –SAI