SA Employment Declined But Wages and Earnings Increasing



South Africa's job market showed some mixed signals in the final quarter of 2023, with total employment declining but wages and earnings increasing. This was detailed in Statistics South Africa's latest release.



Statistics South Africa (Stats SA) released the Quarterly Employment Statistics (QES) report earlier this week which showed a decrease in total employment of 194,000 or 1.8% in the fourth quarter of 2023 compared to the third quarter. This decline was primarily driven by losses in the community services (-214,000 jobs) and construction (-19,000 jobs) sectors.

While employment declined, the trade sector added 56,000 jobs, an increase of 2.4%. There were also gains in transport (2,000 jobs) and electricity (1,000 jobs).

Looking year-over-year, total employment increased by 0.9% between December 2022 and December 2023.

The decrease in employment in the fourth quarter is concerning…However, it's important to note that there was still growth year-on-year. We will continue to monitor the job market closely.

The report indicated that full-time employment decreased slightly in the fourth quarter, while part-time employment saw a steeper decline of 13.5%. However, part-time employment did show growth year-on-year.

On a more positive note, gross earnings paid to employees increased by 5.8% in the fourth quarter, with growth seen across all industries. This trend continued year-over-year with a 4.4% increase in gross earnings compared to December 2022.

Economists React 

Senior economist at FNB Koketso Mano explains the decline in employment, especially in community services aligned with the conclusion of the Presidential Youth Employment Initiative (PYEI). 

That drop in employment would have reflected most of that [conclusion of phase four of PYEI]

Mano says the data released by Stats SA is indicative of the recovery after the global pandemic. However, an economy with low growth is not creating an environment for robust job creation. 

There has been a recovery but in terms of the broader climate, the weak economic growth, and weak investment does not bode well for robust job creation. 

Mano concluded that economic growth of around 5% is needed to effectively combat unemployment in South Africa. 

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