Job losses slow down in mining
The improvement comes against the backdrop of moderate growth in the sector driven by platinum group metals
Job losses in mining have slowed down compared with two years ago, according to the Chamber of Mines.
The improvement comes against the backdrop of moderate growth in the sector driven by platinum group metals, which are back in demand because China’s economic prospects are looking up. The sustained rise of commodity prices has also helped mining.
Figures released by Statistics SA last week show that mining production increased 4.6% year on year in February 2017, after recording a 1.4% year-on-year increase in January.
Chamber of Mines chief economist Henk Langenhoven told Business Day that nearly 40,000 jobs were lost in mining from the beginning of 2015 to the end of 2016.
"However, the rate of job losses has slowed down.
"Between end-2015 and end-2016, job losses amounted to only 4,162. During 2016, this slowed down even further to 2,651 but, disappointingly, increased to 2,902 between the last two quarters of 2016."
Job losses between 2015 and 2016 amounted to 4.5% of the sector’s workforce.
"It’s … still very tough, but if we compare to the beginning of 2015, job losses have slowed down dramatically."
Commenting on the increased production, Langenhoven said: "It’s the impact of better commodity prices."
But he cautioned that it was coming off a low base and that growth remained slow.
In addition to platinum group metals, iron ore also contributed to the growth.
He explained that the growth coincided with better global economic growth.
"China is up, which is one of our biggest demand areas, so demand is definitely building up," said Langenhoven.
Industrial metal prices rose in the fourth quarter of 2016 and have held on to those gains.
Despite the healthy signs of growth, policy uncertainty remains a problem.
"There’s still policy uncertainty and we’ve had no clarity. We’re keen to see what comes out, but there’s no clear signal as to what’s happening with the Mining Charter or any of the policy documents we’re expecting," said Langenhoven.