Unemployment over 30%

2013-02-27 19:06 - Jaco Leuvennink
Students with big aspirations stand on the steps of the Wits University Great Hall.

Cape Town - Employment in South Africa is still 450 000 below what it was in 2008 before the international financial crisis started taking its toll.

This was revealed in the National Budget tabled in Parliament on Wednesday.

It means high unemployment remains the most pressing challenge facing the country.

The Budget Review says there are 4.5 million jobless South Africans and another 2.3 million people categorised as “discouraged” who are no longer actively seeking work, raising the broad unemployment rate to 33.2%.

Slow economic growth in 2012 hindered formal non-agricultural employment growth. Between September 2011 and September 2012, about 82 000 jobs were created, bolstered by rapid growth in national and provincial government payrolls in the middle of the year. Moderate employment growth is expected over the next three years.

With fiscal pressures providing little room for an expansion of public sector employment, job creation prospects will largely depend on private sector hiring.

Youth joblessness remains exceptionally high, with more than 40% of those who are economically active and under the age of 30 unemployed. To date, interventions to encourage the private sector to hire younger workers have proven inadequate, the Budget Review says.

Nominal wage settlements averaged 7.6% in 2012 compared with 7.7% in 2011. After moderating to 5.9% in 2011, growth in nominal unit labour costs has started to rise. Productivity growth averaged just 1.2% over the last two years, according to the Budget Review.

* Visit our Budget Centre for full coverage of the 2013 Budget Speech, including a sin tax and personal tax calculator.

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