A buoyant trade and hospitality sector contributed by far the biggest number of jobs to the economy in the fourth quarter of last year, according to Statistics SA.
The agency’s quarterly employment statistics (QES), released on Tuesday, showed 34 000 jobs were added in the sector which includes retail and wholesale trade, certain types of repair and hotels and restaurants.
The relative strength of employment in the sector is in line with a 5 percent rise in fourth-quarter household spending, reported in the Reserve Bank Quarterly Bulletin. The figure on spending represents a quarterly change, adjusted for inflation and seasonal factors and multiplied by four to show an annual trend.
Other parts of the economy also saw job growth. Stats SA said manufacturing generated 8 000 jobs, in a turnaround after a difficult period. Kevin Lings, the chief economist at Stanlib, noted that the manufacturing sector had shed “a massive 132 000 jobs during the three years from 2008 to 2010”.
Also making gains in the fourth quarter were: transport, storage and communication (4 000); and electricity, gas and water (1 000). However, these gains were offset elsewhere in the economy, so the number of new jobs in the economy as a whole was reduced to 23 000 in the quarter.
The biggest casualty was the community and personal services industry, which lost 10 000 employees, while 9 000 jobs were lost in the construction industry, 4 000 in financial intermediation, insurance, real estate and business services; and 1 000 in the mining sector.
Lings said the figure for total employment followed “a more encouraging increase of 58 000 in the third quarter”. The second quarter saw 11 000 jobs created and the first quarter 38 000.
“Over the past year, South Africa has added 130 000 formal sector jobs,” Lings said. “While this is a reasonable outcome, given the difficult world economic conditions, it is far below the level of job creation required for South Africa to meaningfully reduce the rate of unemployment. More positively, South Africa has created 218 000 jobs in the past two years, with job gains in each of the past seven quarters.”
According to the quarterly labour force survey (QLFS), the informal sector fared worse than the formal sector, losing 26 000 jobs in the fourth quarter. So, at this point, it seems increasingly unlikely that the economy will achieve the 5 million new jobs targeted by 2020. The target, set by Economic Development Minister Ebrahim Patel’s New Growth Path released at the end of 2010, required the addition of 500 000 jobs a year.
The QLFS released last month showed a similar trend to the QES outcome, but the figures were different in quantum. According to the QLFS, 180 000 jobs were created in the formal non-agricultural sector in the fourth quarter. Annual figures also differed. The QES showed 130 000 new jobs last year, while the QLFS reported 453 000 in the formal sector.
QES figures are based on a survey of more than 22 000 VAT-registered non-agricultural businesses, supplemented by data from the Unemployment Insurance Fund and SA Revenue Service. The QLFS is based on face-to-face interviews with the members of more than 30 000 households.
Mike Schussler, the chief economist at economists.co.za, said the QES figures were likely to be more accurate than the household survey. He said, if the businesses surveyed employed an average of 10 people each, it would mean coverage of more than 200 000 employees. - Ethel Hazelhurst