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South Africa’s employment crisis: New government needs to act fast

IFM_South Africa Employment
Both ANC and the centrist DA have taken note of South Africa's lacklustre growth and record unemployment, stating that finding solutions to these problems will be their first priority

The employment statistics made public by Stats SA represent a startling and devastating reality that South Africans have to accept. How have we come to accept significant job losses every quarter without any sort of action plan?

The dismal statistics consistently documented offer little hope to the millions of jobless individuals and young people pursuing higher education in the hopes of finding employment.

According to the Quarterly Employment Statistics (QES), from 10,731,000 in December 2023 to 10,664,000 in March 2024, there was a 67,000, or -0.6%, quarter-on-quarter decline in total employment. This resulted from declines in the mining, trade, community, and business services sectors.

Construction, transportation, and manufacturing all saw growth, but the biggest obstacle to growth and development is still the inability to create enough employment to offset the losses. Overall employment fell between March 2023 and March 2024 by 74,000, or -0.7%, year over year.

“We remind the authorities that sustainability still matters more than band-aid fixes. Jobs that support long-term growth and lives are necessary for South Africans. To ensure that young people have the necessary skills, we need to make significant investments in STEM (science, technology, engineering, and mathematics) as well as in education and programmes for vocational training that are in line with industry demands,” stated Abigail Moyo of Bizcommunity.com, while reporting on the grim situation.

According to Carel van Aardt of the Bureau of Market Research (BMR), there are numerous explanations for the poor employment growth performance in the mining and agriculture industries, as stated in the 2024 UASA South African Employment Report (SAER).

The paper says that big changes in employment growth will not happen until the government starts to deal with problems like the slow rise in gross sector value added, low business confidence, an unfavourable business environment, low investment because of political comments that companies in certain industries might be nationalised or taken over, changing trends in the demand and prices for mining and agricultural products, and high crime rates that affect these two industries.

“We can’t depend on band-aid solutions like contract work and the unorganised sector. We implore the incoming administration to confront the jobless issue head-on to keep our economy strong. If things continue this way, with no end in sight, our country will soon be in a catastrophe as people fight for their lives,” Moyo noted further.

The ongoing job market crisis will call for action from South Africa’s new government, where the ruling ANC will share power for the first time after losing its outright parliamentary majority in the recently held elections.

While President Cyril Ramaphosa had to lead gruelling negotiations to balance demands for key ministerial posts from his party and its new allies, apart from mediating different views to come up with a common policy agenda on the economy, the main challenges and priorities for the new cabinet will be poverty and unemployment.

Both ANC and the centrist DA have taken note of South Africa’s lacklustre growth and record unemployment, stating that finding solutions to these problems will be their first priority. Millions of people are currently living in poverty in the country where 33% are unemployed out of a population of 62 million, far more than when the ANC came into power. Also, some 28 million are relying upon welfare grants to survive.

“In the GNU’s statement of intent, job creation, investment and fiscal sustainability were among the goals listed to remedy the weakened economy that has frustrated South Africans and dented the ANC’s popularity,” media agency AFP stated.

Despite South Africa being the continent’s most industrialised nation, access to basic services such as water and electricity has been a recurring source of anger for tens of millions of inhabitants.

“Due to a shortfall in energy production and frequent breakdowns at ageing power stations, the nation has for years suffered from economy-crippling, rolling power cuts that at their worst last up to 12 hours a day,” AFP stated further.

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