Not enough skill in Mpuma

But the province is only able to generate employment opportunities in the formal market at a rate of 1.2% a year, says provincial finance MEC Mmathulare Coleman.

"The formal sector is no longer able to absorb all the entrants to the job market as rapidly as one would wish," she said. "Our only hope to create more jobs lies with small business."

She said it was imperative to lower the cost of doing business for small enterprises and re-examine regulations that govern hawkers and small entrepreneurs.

She added that most of the province's labour force seldom had the necessary skills to enter the formal job market.

"One of the impediments to job creation is the low level of skills in the province," Coleman said.

She said only 11.7% of employed people in the province had a tertiary qualification and only 20.8% had matric.

She said that the number of people employed in the formal sector had also dropped by 8.9% from 57.7% in 1996 to only 48.8% in 2002.

More than half the province's 3.1 million people live in poverty, which is above the national average of 48.9%, she said.

Yet unemployment in the province stands at 36.7%, which remains lower than the national unemployment rate of 40.8%, she added.

Coleman expressed concern that economic sectors that once provided the most jobs, had shown a drop in growth.

Agriculture had declined by 1.7%, trade by 0.3% and mining by 2.3% between 2000 and 2002.

Sectors that had shown a positive growth included electricity and services at 0.4% each and construction at 3.6%.

"It is important to note that the sectors that have high levels of growth are in the informal section of the economy and not in the formal sector," she said.

She attributed this to the rapid increase in spaza shops, hawkers and informal traders in the tourism industry.

Coleman also pointed out that the average growth rate for the province from 1996 to 2002 was 1.8%, which was in line with the national average of two percent.

The growth rate is projected to be 2.6% between 2002 and 2007, she added.

"It is not surprising that Mpumalanga is referred to as the fastest growing province in the country. It has seen rapid urbanisation and economic activity partly due to the Maputo corridor and tourism development," she explained.

"However, the creation of jobs for the growing population and the people who migrate into the province still remains a challenge."