Unemployment climbs as farms shed jobs

South Africa’s unemployment rate rose in the fourth quarter as the social services and agriculture sectors cut jobs.

The official jobless rate increased to 32.1% in the three months through December from 31.9% in the previous quarter, Statistics South Africa said Tuesday in a report released in the capital, Pretoria. The median estimate of eight economists surveyed by Bloomberg was 31.6%.

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The negative data may further erode voter support for the ruling African National Congress’s before elections later this year and bring further pressure to bear on the country’s fragile finances as fewer people pay taxes and more draw on welfare grants. A R350 (S18) monthly stipend for the unemployed already has 9 million recipients and President Cyril Ramaphosa has pledged to extend and improve it.

Finance Minister Enoch Godongwana will provide more details on the nation’s finances when he tables the budget on Wednesday.

Unemployment according to the expanded definition, which includes people who were available for work but not seeking a job, stood at 41.1%, compared with 41.2% in the September quarter, Statistics South Africa said.

Read: How unemployment has changed since 2000

The jobless rate may continue to rise as weaker commodity prices and logistics constraints on the freight-rail system and at ports operated by Transnet take their a on mining companies’ profits. Anglo American Platinum on Monday proposed a restructuring that may affect 3 700 jobs across its South African operations and Seriti Resources Holdings is considering laying off 600 workers.

Watch Finance Minister Enoch Godongwana LIVE as he tables the Budget Speech at 2pm on Wednesday, 21 February.

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Source: moneyweb.co.za