Jobs target slipping away

Johannesburg - Another increase in South Africa's unemployment rate during the second quarter has turned government's goal to reduce joblessness into a Herculean task.

The number of out-of-work South Africans rose to 23.6% in the second quarter of 2009, from 23.5% in the first quarter, according to Statistics SA.

The total number of employed people dropped 267 000 to 13.4 million. Most job losses (105 000) occurred among those employed in private households. The formal sector lost 93 000 jobs, while 41 000 were left without work in the informal sector. The agricultural sector shed 28 000 jobs.

Earlier in 2009, President Jacob Zuma pledged to create 500 000 job opportunities before the of the year through the extended public works programme.

"The 500 000 target was ambitious to begin with. Today's employment numbers will make it very difficult to obtain," said Jeff Schultz, macro strategist at Absa Capital.

Zuma softened job-creation expectations last week, when he addressed the Confederation of Black Business Organisations.

"Even if the economy begins to grow again next year, we will have to wait a little longer for a significant increase in new job creation," said Zuma.

Schultz said it is important to remember Zuma referred to "job opportunities" ie potential and not actual, existing positions in his state of the nation speech.

"Job opportunities don't necessarily translate into actual jobs," he said.

Stats SA also said job-seekers were becoming more and more discouraged. More people are giving up hope of finding work and many feel there are no jobs within their physical proximity that match their skills.

Schultz said he expected employment to remain under pressure for the remainder of 2009.

"We do believe we are through the worst, but the prospects of employment improving dramatically this year are very small," he said.

- Fin24.com