South Africa’s robust economic growth made a small, hardly noticeable dent in the country’s massive unemployment rate. Yet those who are lucky enough to be employed in the formal sector saw earnings increase faster than the number of their peers. These are some of the findings of the Labour Force Survey (LFS) and the Survey of Employment and Earnings (SEE), both released by Statistics South Africa on Thursday.
The LFS estimates that between March and September last year the unemployment rate fell from 27,9% to 26,2%. In September the economically active population stood at 15,8-million, almost the same as in March. Of these, 4,1-million were unemployed, down from 4,4-million six months earlier. The number of employed registered a corresponding increase of 300 000, rising from 11,3- million to 11,6-million.
Of those employed, 7,6-million are in the formal sector, whose levels of earnings are measured by the survey. The SEE, however, puts the number of workers in the formal sector at 6,6-million, a discrepancy attributed to the fact that it focuses on VAT registered businesses.
The survey found that in the year to December last year, the number of employees rose by 4%. Over the same period, employees enjoyed a gross increase in pay of 14,9% to R154,3-million. This was accompanied by tax cuts and low price increases.
Yet for the unemployed the search continues.
The LFS shows that youth unemployment has fallen but remains chronically high. Unemployment among 15- to 24-year-olds — the fastest growing segment of the population — fell from 55,6% in March to 51,8% in September.
Unemployment remains highest among Africans, at 31,3%, followed by coloureds, at 21,8%, Indians and other Asians at 13,4% and whites, at 5,4%. Over the six-month period the number of discouraged work seekers rose by 200 000 to 3,9-million. Of these, more than 60%, or 2,5-million, are female.
The Western Cape has the lowest unemployment at less than 20%, while Limpopo, North West, KwaZulu-Natal and the Eastern Cape have levels of more than 30%. As expected, Gauteng provides the bulk of opportunities, with about three million jobs, while the Northern Cape provided about 230 000 jobs in September.
This relatively stagnant jobs picture and improved earnings comes against a backdrop of falling wage settlements, recovering productivity and declining nominal unit labour cost.
According to the Reserve Bank’s Quarterly Bulletin, the average increase in remuneration per worker moderated from an annual rate of 9,6% in 2002 to 8,7% in 2003 and 7,7% in the first three quarters of 2004.
Productivity throughout the economy is on the rise, but is nowhere near the peak of 2000, which was reached because of retrenchments. The annual rate of real output per worker declined in the first three quarters of last year.
Only manufacturing enjoyed an increase of 2,9% in the period to September last year. The cost of labour per unit of production fell to 4,9% in the third quarter, from around 6% in the preceding one.
20 000 jobs on the line
Almost 10 000 jobs have been lost since January and 20 000 more are under the axe as companies continue to shed workers, largely because of the rand’s strength.
The white union Solidarity said the scale of retrenchments “constitutes a state of emergency. If a natural disaster resulted in thousands of people losing their houses and security, the government would certainly provide relief.”
Figures provided by trade unions this week show that more than 20 000 workers across various sectors have been served with retrenchment notices. Most of the job cuts will take effect at the end of April.
The mining industry is hardest hit, with more than 10 000 jobs threatened. Also high on the job-shedding list is the clothing and textile sector, which has been hit by competition from cheap imports.
According to the South African Clothing and Textile Union about 2 750 workers from four companies are likely to be retrenched next month. This is in addition to the 3 100 jobs lost since the beginning of the year.
The latest casualty is Prestige Lingerie, part of Seardel KwaZulu-Natal, which announced this week that it intends retrenching 750 of its 1 000 workers. Solidarity said it was dealing with 18 293 threatened retrenchments at 25 companies.
In mining, the union said the largest number of planned retrenchments was at Harmony, which had issued retrenchment notices to 4 914 workers. The jobs of 6 513 Durban Roodeport Deep workers are at stake after the high court granted provisional liquidation of the company’s North West operations. About 1 270 jobs at De Beers and 400 at Kumba are also in jeopardy. About 650 jobs are also being shed by the chemical industry. — Matuma Letsoalo