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Unemployment in the fourth quarter of 2019 stayed put at record highs, Stats SA’s quarterly labour force survey (QLFS) revealed on Tuesday, underscoring the difficulty the country’s anaemic economy has had in creating jobs.

The unemployment rate was unchanged at 29.1%, its highest level since this survey began. This time around not even festive season trade, which has in the past contributed to a seasonal decline in the unemployment rate in the fourth quarter, came through to boost the gloomy jobs picture.

Using the expanded definition of unemployment, which includes discouraged work seekers — those available to work who have stopped looking for a job — the unemployment rate rose to 38.7% on a quarter-on-quarter basis, up from 35.5%.

At these levels, SA’s unemployment is deemed unsustainably high and sharply out of kilter with efforts by President Cyril Ramaphosa’s administration to boost jobs growth and reduce poverty and inequality.

Though Ramaphosa is targeting R1.2-trillion of investment in the economy by 2023 as a means to boost jobs growth, the sluggish pace of economic reforms, as well as issues such as power shortages from power utility Eskom, have left business and consumer confidence weak.  

The latest data comes nearly 13 months after the government’s jobs summit and 17 months after the release of Ramaphosa’s economic stimulus and recovery plan, said PwC economists Lullu Krugel and Christie Viljoen. “Clearly, neither endeavour has had a real positive impact on the country’s employment creation,” they said.

For the first time since 2008, the QLFS also did not see a decline in the unemployment rate in the fourth quarter, according to Stats SA, referring to a quarter historically associated with an increase in temporary jobs in the trade sector.

In the past this sector has provided a temporary boost to jobs during the fourth quarter as it gears up for the festive season, according to Malerato Mosiane, the acting chief director of labour statistics at Stats SA. Instead, the sector saw a decline in jobs numbers, especially in the informal sector, she noted, shedding 159,000 jobs.

This is another “very disappointing” outcome, Absa senior economist Miyelani Maluleke told Business Day, particularly as sectors such as trade did not provide the seasonal boost that has come to be expected with December shopping and, more recently, Black Friday sales in November.

Growth in the economy “is simply not enough to accommodate all of the new entrants into the labour market every year”, he said.

Where jobs growth did occur, this was led by the community and social services sector, which includes the government, noted Maluleke.

Though the QLFS data is not seasonally adjusted and is accompanied by volatility, the increase in jobs in this sector was “unusual”, said Maluleke, particularly given the government’s message about efforts to stabilise the public sector wage bill.

Youth unemployment, which focuses on people aged 15 to 24, came in at 58.1%, up 3.4% on an annual basis. But on an expanded basis for the fourth quarter, the youth unemployment rate came in at 69.5%.

The outcome reflects “the poor state of the economy, especially the lack of fixed investment spending by both the private and public sectors”, Stanlib chief economist Kevin Lings said in a note.

The youth unemployment rate is a national crisis with significant social, economic and political implications, he added, “yet the political environment appears to lack the level of urgency required to start to deal with the crisis”.

Correction: February 11 2020
A blurb for an earlier version of this story incorrectly stated that this was the first time that jobs had decreased for the fourth quarter, when in fact it is the unemployment rate that has not decreased in the fourth quarter for the first time since 2008.

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