There is some good news in the unemployment numbers out today (read the Quarterly Labour Force Survey here). From July to September, 399,000 more people were in work than in the previous quarter. There are in fact 979,000 more people in work than from July to September 2022.
But good news is relative in South Africa when it comes to unemployment. The number of people out of work is still catastrophically high. We still have the highest unemployment rate in the world. Among the working age (15- to 64-year-olds), we still have just four in 10 people in paid work.
Alarmingly, three-quarters of those looking for work have been doing so for more than a year. That means that among the 12 million people available for work – the expanded measure of unemployment – nine million have been unemployed for more than a year.
Over the past year, the second-biggest job-creation sector (after the finance sector) was community and social services, which includes the public works programmes that accounted for 1.8 million jobs in the 2022/23 financial year.
Establishment figures like Andrew Donaldson, ex-deputy director-general of National Treasury, and Kate Philip, lead in the Presidential Employment Stimulus, tell us that we should be expanding public works because supporting an unemployed person far outweighs the cost.
Yet, the finance minister just cut the budget to public works programmes, imperilling hundreds of thousands of these jobs.
Those who benefit from these programmes are disproportionately young people who are finding it the hardest to find work. Under-25s suffer a 68% (yes, sixty-eight percent) unemployment rate. Public works benefits them and we’re cutting it back.
We would all love for our private sector to be thriving in South Africa. Considering the lack of support it gets, one could certainly argue that it makes the best of a very adverse environment. What is less appreciated, perhaps, is how public works is currently supporting one of the most crucial enablers of private employment: Education.
Read more in Daily Maverick: Hundreds of thousands of jobs likely to disappear with Godongwana’s public employment budget cuts
The Presidential Employment Stimulus (PES) is doing just that. Through its school assistant programme in 23,000 public schools, which makes up the majority of its 650,000 jobs a year, there are early signs that supported pupils are 1.5 years ahead of their peers.
It is for this reason that Progress, a new party focused on jobs, is promising an expansion of economically and socially beneficial public works alongside extensive support for micro-entrepreneurs.
Evidence coming out of the PES, as well as from huge public works programmes in other countries, such as NREGA in India which employs 55 million (yes, fifty-five million) people a year, suggests that public works can play a far more important role in dramatically reducing unemployment in South Africa.
Done well, modelling suggests not just that the country can afford it but also that GDP would grow faster than debt and that it can be a crucial supporter and enabler of a private-sector recovery. DM