Cape Town - The number of unemployed people will soon outstrip those in formal employment. This as about 700 000 new matriculants are poised to swell the job seekers' queue, with 9.4 million unemployed already.
Economists have warned the prospects for employment this year don't look good.The business community was also sceptical about the economy's growth and predicted more job losses were on the cards.
They said some of the main reasons for the expected sluggish growth was the economic downgrades, low investor confidence and the rampant levels of corruption in the corridors of power.
Economist Mike Schussler said the economy simply does not have the muscle to create more jobs. “We cannot even keep the current jobs we have. So it will be tough for the economy to absorb more people. There are predictions that the current 9.4million unemployed could rise to even more than 10million,” he said.
The fourth quarter (October to December) of the year always provided more job opportunities, Schussler said.
“But that will not persist during the year. Many jobs come up in the last part of the year because a lot of places take on extra hands for the festive season. But our economy is not in a good space and it will continue to shed jobs,” he added.
Schussler said the government should make it easier for business to do business. “We need to ease labour legislation, make exporting easier. Business needs to be given title deeds which will give them some sort of security (on properties) and to make the environment easier for the various sectors."
According to Statistics SA, the third quarter of 2017 showed a decline of 31000 jobs to 9589000 in the formal non-agricultural sector in the quarter ending in September. This is a loss of 83000 jobs when compared with the same period in 2016.
Quarterly employment declines were mainly driven by the community services industry with 10000 jobs. Additional job losses were observed in the mining and quarrying industry, 9000 jobs; trade industry 7000; business services 6000; manufacturing 5000 and the electricity industry, which lost 1000 jobs.
There were, however, increases in employment in the construction industry as well as the transport industry with 4000 and 3000 jobs respectively.
SA Chamber of Commerce and Industry chief executive Alan Mukoki said 2018 would be a tight year with very little jobs growth.
“We don’t have enough capital to sustain the current jobs we have and it is becoming difficult to create new jobs. Government needs to invest in new markets and infrastructure and should use development and land banks for this purpose. They need to work on the problems and tackle it. We need to start walking the walk,” he said.
The private sector should also start playing its role. “They need to industrialise their businesses and diversify their portfolios. We cannot continue importing about 65% components for the products we make.
"The components can be made here completely without importing anything. We also need skills. We need to prepare for the fourth industrial revolution,” he said.
The Black Management Forum in a statement said the new ANC leadership needs to unite the country in creating a better and more inclusive economy.
“The country is in dire need of ethical and servant leadership. We urge this newly elected leadership to provide the leadership we need."
@JasonFelix