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Slight drop in unemployment rate

By News24 28 July 2016

Cape Town - The official unemployment rate in the second quarter of 2016 declined slightly with 0.1 of a percentage point to 26.6%, Statistics South Africa announced on Thursday.

That means of the 36.6m people of working age in South Africa between the ages of 15 and 64 years old, 5.6m people are currently not employed.

Despite the slight decrease in unemployment, total employment contracted by 0.8% due to job losses in the service, agriculture, transport and mining sectors of the economy. Conversely job gains were reported in manufacturing, private households and construction.

The expanded unemployment rate, which includes people who did not look for work, but were available for employment during the second quarter, increased by 0.1 of a percentage point to 36.4% or 8.9m people.

The level of inactivity also increased by 379 000, implying that people who lost jobs became inactive instead of moving into unemployment. The number also includes people who were previously looking for work, but stopped doing so.

Youth (South Africans between the ages 15 to 34 years) and those without matric remain the most vulnerable with regard to unemployment. The youth unemployment rate alone stands at 37.5%, representing a total of 3.2m young people.

The Free State and Gauteng were the provinces with the highest unemployment rate at 32.2% and 29.5% respectively.

Statistician-general Pali Lehohla said the slight decline in the unemployment rate was “nothing to go to town about” and the absorption rate of 42.5% was a far cry from the 61% mooted in the National Development Plan (NDP). During 2008 and 2016 the labour force participation rate (the percentage of working-age persons in an economy who: are employed and who are unemployed but looking for a job) decreased from 46% to 42.5%.

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