The Q1 2026 economic data is poised to bring a headache for South Africa’s economy, as the unemployment rate climbed to 32.7% from 31.4% in the fourth quarter of 2025, with the Cyril Ramaphosa administration already grappling with soaring petrol prices and the twin spectres of accelerating inflation and slowing growth amid the Iran conflict.
The quarterly labour force survey data, released by Statistics South Africa (Stats SA), showed that the number of employed persons in the quarter fell by 345,000 to 16.8 million, while the ranks of the unemployed swelled by 301,000 to 8.1 million.
To simplify things further, about a third of South Africa’s labour force is without a job, and things may get worse as the economic outlook sours with each passing day, with the Middle East conflict involving Iran, the United States and Israel showing no signs of permanent stoppage.
However, there was a ray of hope, as the manufacturing (38,000), mining (32,000) and agricultural sectors (10,000), the traditional trio that has historically served as the bedrock of South Africa’s economy, ended up adding jobs. In fact, the “skilled agriculture” category witnessed an increase of almost 60% from the previous quarter.
Also, the overall picture was gloomy, with community and social services shedding 206,000 workers, while the labour-intensive construction sector lost 110,000, a fall of 15.5%. Among the provinces, only KwaZulu-Natal added employment, a paltry 6,000.
Although there was a 2.0-percentage-point rise in youth unemployment, it remained below the record high of 35.3% reached in Q4 2021 when the COVID pandemic was still hammering the economy.
To complicate things further, South Africa’s GDP has been growing at a snail’s pace, with 2025 registering a paltry 1.1% increase, lower than the country’s central bank and National Treasury forecast. While the uptick was mainly concentrated in consumer-facing sectors, primary and secondary parts of the economy shrank. In 2025, investor confidence increased due to the improving fiscal situation and the Ramaphosa government’s commitment to maintaining low inflation.