SA jobless rate rises to 25.5%

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Jobless1 . File photo: Simphiwe Mbokazi.

Johannesburg - South Africa’s unemployment rate, the highest of more than 40 emerging markets tracked by Bloomberg, increased to 25.5 percent in the second quarter.

The rate rose from 25.2 percent in the previous three months, Statistics South Africa said in a report released today in the capital, Pretoria.

The median estimate in a Bloomberg survey of seven economists was 25.4 percent.

The number of people without jobs surged by 87,000 to 5.2 million, it said.

Africa’s second-largest economy has been struggling to rein in unemployment since a 2009 recession.

A series of strikes this year have undermined economic expansion, prompting the central bank to lower its growth forecast for this year.

The government estimates it needs growth of 5.4 percent a year to cut the jobless rate to 14 percent by 2020.

“Employment prospects remained unpromising” in the second quarter, Mamello Matikinca, a strategist at FirstRand’s investment-banking unit, Rand Merchant Bank, said in an e-mailed note to clients before the data was released.

“The prolonged strikes in the mining sector most likely suppressed labor growth.”

A five-month stoppage at platinum mines that ended June 24 caused output to plunge in the first quarter.

A week after miners went back to work, more than 220,000 employees in the metals and engineering industry began a walkout.

Employers warned last week that high wage increases will lead to massive job losses.

Manufacturers shed 60,000 jobs in the quarter, while employment in mining fell by 5,000, the statistics office said.

Jobs in farming fell by 39,000, construction dropped by 18,000 and financial services by 34,000.

Employment rose in just two of the eight industries measured by the statistics agency, surging by 103,000 in the community and social services sector, which includes government workers.

The unemployment rate is compiled from a household survey covering the formal and informal industries. - Bloomberg News



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