The prospect of getting a job looks bleak in light of the decrease in the country’s gross domestic product (GDP) by 0.3% in the fourth quarter of 2016.
Michael Manamela, chief director for national accounts at Statistics SA,, said the decline of growth on the primary sectors of the economy such as mining was likely to affect prospects of finding a job.
“The areas where it would be easy to absorb employment would be your primary sector and those are the ones that are showing a decline.”
He said it was quite difficult to reduce unemployment with the prevailing decline of growth in the primary sector.
Manamela was addressing the media in Pretoria yesterday about the GDP statistics, which captured how various sectors of the economy performed in the fourth quarter of last year.
He said the rest of last year had generally seen slow growth of the economy, adding the 0.3% decline in GDP was a slight drop from a 0.4% increase in the third quarter.
The mining and quarrying industry was among the primary sectors which saw a decrease of 11.5% in the fourth quarter.
“This was largely the result of lower production in coal, gold and other metal ore, including platinum,” Manamela said.
Global demands attributed to the slump in the mining sector, he said.
“Most of our minerals are destined for exports and if the global demand is slow, that would obviously have a slow-down (effect) on the mining sector,” he said.
Manufacturing, on the other hand, decreased by 3.1% due to lower production in the food and beverages, petroleum, chemical products, rubber and plastic products.
The manufacturing of motor vehicles, parts and accessories and other transport equipment also contributed to a decline in the manufacturing sector.
“What it means is that there is not much that is happening in the economy.
“The declines are shown in the primary sector, which are your mining sector and secondary sector, which is manufacturing, and those are our kind of industrial areas.
“Those will have ripple effects in terms of employment prospects,” Manamela said.
“Despite the recent good rains, agriculture, forestry and fishery industry had seen a decline for eight consecutive quarters.
“If you look at the growth trajectory you will notice that the trend is upward, but it is still negative.
“The rains depend quite a lot in terms of what was already ploughed and how much was already damaged. Agriculture should recover in 2017,” he said.
However, the situation was not all doom and gloom.
Positive contributors to the GDP came from trade, catering and accommodation industry, which increased by 1.6%.
Finance, real estate and business services increased by 2.1%.
Manamela said the household consumption expenditure increased by 2.2% in the fourth quarter, contributing 1.3% points to total growth.
“The largest contributors to the growth of 2.2% were food and non-alcoholic beverages, clothing and footwear,” he said.
There had been an increase of 0.4% in construction, specifically in the construction works and residential buildings.
In 2014, the mining sector was affected in the North West due the intermittent strikes. However, last year’s GDP recorded a recovery growth of 4.9%.
Gauteng continued to be the biggest contributor to the GDP with 34%, followed by KwaZulu-Natal at 16%.