Unemployment rate bombshell
The figures show a jump of 2.2% over the 24.5% figure for the fourth quarter of 2015.
DATA released by Stats SA shows the national unemployment rate increased to 26.7% in the first three months of 2016.
The figures show a jump of 2.2% over the 24.5% figure for the fourth quarter of 2015.
Despite Trade losing 119 000 jobs, Manufacturing 100 000 jobs and Construction 77 000, Agriculture and Community and Social Services grew by 16 000 and 51 000 respectively, employment is still higher in the first quarter of 2016 compared to the same period last year.
The overall unemployment rate of 26.7% was calculated by combining the employment decline of 355 000 jobs with the number of unemployed persons, 521 000.
Locally however, the picture is far bleaker.
According to the Deputy Dean of Research and Internationalisation at the University of Zululand Faculty of Commerce, Administration and Law Professor Irrshad Kaseeram, the unemployment rate in for the Empangeni-Richards Bay hub and its immediate surrounds is between 35 and 39%.
‘Since the Empangeni-Richards Bay economic hub is located within a rural sub-region one can expect a much higher unemployment rate when compared to the national average,’ he said.
‘It has been established in recent times rural unemployment ranges between 44 and 52%, hence one can safely assume the figure of 35 to 39% for our area.’
Inflexible
Prof Kaseeram explained the main reasons behind high unemployment in South Africa could be attributed to inflexible and restrictive labour laws, policy uncertainty in regard to mining and private property rights poor standard of basic education (especially maths and science), a bloated, expensive and inefficient bureaucracy, a restrictive and inhibitory environment in setting up businesses and attracting skilled foreign workers.
‘In the rural context, inadequate progress regarding small-holder farmer development and the land tenure system which dis-incentivises black farmers to invest and a lack of growth in employment in the commercial agriculture sector, perhaps due to proposed land restrictions,’ he said.
‘These factors, together with poor economic prospects globally, means SA’s growth potential has been on the decline, evidenced by the rising unemployment rate.
‘Our unemployment rate is much higher compared to other upper middle income developing countries. For example we have much in common with Brazil – a BRICS partner – whose present unemployment rate is 10.9% which is a rise year’s 9.3%.’
Analysts this week shared fears the announcement of the unemployment rating amid talks of a credit rating downgrade could further negatively affect the economy.
Meanwhile labour federation COSATU has called for a summit with government and big business to tackle what they are calling a crisis.
