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2011: South Africa's Year of Job Creation?

Fernando Im's picture

The latest figures from the Quarterly Labor Force Survey (QLFS) indicate that the unemployment rate has fallen from 25.3% in 2010Q3 to 24% in 2010Q4.

After shedding 86,000 jobs between 2010Q2 and 2010Q3, employment increased by 1.2% q/q, adding 157,000 jobs between 2010Q3 and 2010Q4. Although these figures are encouraging, unemployment has been persistently high over the past decade.  Unemployment has not fallen below 21% since 2001. Moreover, as a result of the global financial crisis, over 1,000,000 jobs were lost.

Things look worse if other factors are taken into consideration. First, unemployment is unacceptably high among young work-seekers. One out of two young workers is unemployed –and an even higher proportion if we also include discouraged workers. Given the severity of the problem, job creation is the top priority in both the budget announced for FY2011/12 and the State of the Nation Address by President Zuma.  Among other measures, a Jobs Fund and a Youth Employment Subsidy were announced. Second,  workers find it increasingly difficult to find a job: 68% of the unemployed (a striking 16.3% of the labor force) have been without jobs for more than a year, with the deterioration of skills set that long-term unemployment conveys.

What will it take to bring down unemployment? How many jobs need to be created in the next ten years? The working age population has been growing at 1.5% per year. Suppose the government wants to reduce the unemployment rate by 10 percentage points. If the participation rate were to stay constant around 55%, roughly 4 million jobs need to be created in the next 10 years. But if the participation rate were to increase to the upper-middle income country average, the economy would have to create between 7 and 8 million jobs in the span of 10 years.

Is this feasible? Post-apartheid South Africa achieved the highest economic growth rates (at least 4.5% per annum) between 2004 and 2007.  Between March 2004 and March 2005 approximately 680,000 jobs were created, and between March 2005 and March 2006 another 734,000 were created. Job creation decelerated between March 2006 and 2007, with only 89,000 being created.  Although it’s not an impossible task, data indicate that creating even 500,000 jobs per year--an objective set in the New Growth Path—might be a formidable task without taking some bold measures to address structural issues . So, will 2011 be the year of job creation?


Submitted by Adele on
If we can reduce unemployment and poverty, then we will reduce crime. We do not feel that government is able to impact unemployment. Their claim of creating 5 million jobs in the next 10 years is seriously questionable. They havent been able to do it in the last 17 years so why all of a sudden can they do it now? After almost 2 decades their best plan for job creation is a R 9 billion Jobs Fund. They have apportioned money to this fund but they don't actually have any ideas on what to do. You cannot just 'create' jobs. There is no use in putting people in positions that are not needed, but hey, let's 'create' a job for this guy. If we can take care of people who are so horribly affected by poverty by helping them build a home, grow vegetables, and firstly look after themselves, and during this transformation start earning an income, these individuals will have cash in their pockets, they will want to go and spend that cash, and eventually, the retailers would have to employ more staff because of the demand in service. That is job creation. Our team at 1 Way Forward is ready and willing to assist in Job Evolution, but, we need the whole of South Africa to stand together, and move forward together, as a nation and let's get rid of poverty and unemployment in a way that in 10 years time, there will not be one person suffering like this! Think about it..... visit our website today, and become part of the change

Submitted by Sabs on
I kinda like agree with what you say, but in a broad sense of things, let us look at like this, how executives in big companies earns huge amounts of money, it is not fair for an executive to rank in 1.8 million per month while the very same company has a general worker who labours very hard and earn R6000.00 per month, why can`t companies cut down on executive pay and create a relaxed working environment for those general workers by bringing more staff, say if you cut down hundred thousand from one executive, how many general workers can you employ with that????? it will be feasible for a company to do so, they can even do that ona contactual basis if they were to run away from committments. how is that????

At 61 percent overall unemployment rate. The job market is extremely difficult for younger generation with no employment experience. Job Space are trying to help, empower, and inspire them to reach their full potential for a better life, hopefully as a collective effort, they will create a better South Africa!

Submitted by Anonymous on
TO SABS:I think that this is abosolutely great but i also think that a percentage of the executives has earned their current package by doing things that are unseen to the rest of us. The rate of crime has a to increased due to the increase of addiction to substances such as drugs, alcohol, gangsterism etc. The creating of new jobs would be ideal but would it solve the addiction that many choose not to control? If in a perfect world nobody turned to abusing alcohol or drugs then things wouldve been different. So many things needs to be looked at as a whole many of which i havent touched but i really hope that things would change dramatically for SA as a whole that will improve many cirumstances. Many of SA citizens are neglecting to do things that could cause change. If people's mindset could change it would help quite a bit. If mentality, perspective and approach changes many would be helped. I pray that the year 2012 would hold many fulfillments to many in great expectation. May doors open that has been locked to many ignorant minds. May the whole of SA unite as one in wanting to help and cause effect.

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