Cape Town -
The Western Cape economy is still growing, but lack of vigour in the
manufacturing and construction sector is a cause for some concern, reckons
Economists.co.za chief economist Mike Schüssler, who compiles the Sake24 and BoE
Private Clients Western Cape Barometer.
In May the
barometer's main index fell 0.5% to 107.8 points.
three months to May the regional economy was supported by expenditure growth in
government, as well as the transport, electricity and commercial sectors.
growth failed to create jobs. Unemployment in the Western Cape
is currently at 20.5% and the barometer's employment index shows that in May
there were 9.4% fewer jobs created in the province than a year ago.
It is this
factor that drove up the barometer's stress index by 2.5% in the past three
months, despite lower interest rates and inflation.
commercial index the vehicle industry - with sales rising 23.9% in May -
contributed to strong growth. Hotel and restaurant activities were 5.3% up. Construction recovery will take time
subsector rose a mere 0.4%, but this was the first time in five months that
this part of the commercial index reached positive territory. Furniture and household goods sales were a particular help.
suspects it was sales of flat screen television sets with a view to the
2010 FIFA World Cup rather than furniture purchases which propped up the retail
transport index indicates that activities at the Cape Town, Saldanha and Mossel
Bay ports increased by 3.3%, with passenger traffic at Cape
Town and George airports 5.3% up in May.
construction index is still struggling. Although the number of completed houses
smaller than 80m² rose by 2%, the number of bigger ones declined 26% while
completed townhouses, in turn, were 107% up.
expects it will take considerable time for the construction industry
to recover. He said the sector has also been affected by the sharp decline in the
property market - related, in particular, to the reduction in residential