South Africa’s unemployment rate dipped to 25,6% in March from 26,5% in the same month last year, with more than half-a-million jobs created during that time, official data showed on Tuesday.
Africa’s largest economy is battling to cut stubbornly high unemployment despite faster economic growth, with the government spending billions of rand on infrastructure as part of its drive to slash widespread poverty and reduce income disparities.
A separate official report on Tuesday supported evidence that faster growth was finally generating jobs, with the number of people employed in South Africa’s non-farm sectors up by 3,1% in the second quarter versus the same quarter last year.
”The [jobless] trend is declining, that is the message, that is what we are seeing from the numbers,” said Kefiloe Masiteng, deputy director general of population and social statistics at Statistics South Africa (Stats SA).
High unemployment and poverty have clouded South Africa’s economic gains since the end of apartheid in 1994 and are seen as the main reason for the country’s high rate of violent crime, as well as a possible future source of social instability.
The total number of new jobs created in the year to March 2006 amounted to 544 000, the labour report showed.
But the figures showed that the expanded definition of unemployment, which includes people who have stopped looking for work, barely budged at 39% in March compared with 38,8% in September 2005.
This was because of seasonal trends, Stats SA said. It did not release a comparison for that ratio for March 2005.
”It’s encouraging that unemployment has come down but it still remains exceptionally high,” said Nedbank chief economist Dennis Dykes.
”Manufacturing is up. Construction is up quite significantly. [But] one of the issues is the quality of the jobs and whether it is in areas where there is some element of temporariness.”
Gross non-farm earnings — which highlight wage trends and inflation pressures — rose by 9% in the second quarter compared with the same quarter in 2005, the Stats SA data showed.
Statistics South Africa’s twice-yearly official Labour Force Survey always lags the country’s quarterly labour and earnings report, which were both released on Tuesday.
There was no market reaction to the figures. — Reuters