Zuma admits jobs target won't be met

Cape Town - President Jacob Zuma conceded on Thursday that the state of the global economy would likely prevent South Africa from reaching the growth necessary to create five million jobs by 2020.

He told the National Assembly the target - contained in the new growth path - was set while the world was recovering from the 2008 economic crisis, and before the latest round of eurozone woes began.

"When the government said it was going to create a particular number of jobs, we were discussing that matter in the face of the recovery globally from the 2007/2008 financial problems," he said while answering questions in the legislature.

"Of course, things have changed. We now have another financial crisis.

"As long as you have the economic problems you cannot move faster in terms of the growth... we are still on the positive not on the negative, but we can't grow as fast as we thought we would.

"Nobody could predict that there would be this global situation when we said this is how we are going to grow. We said that in the economic landscape of the time. What the government is going to do - I don't think we can do magic."

The Development Bank of Southern Africa warned on Monday that the national economy would need to grow at 9% to 10% annually to reach the jobs target, not the 7% the government believed was required.

Finance Minister Pravin Gordhan has forecast growth of 3% to 4% until 2013.

Zuma said while it was clear that "we are able no longer to just move faster as to grow up to 10 or 9", the government would do its best to ensure that employment figures remained positive.

Joblessness eased from 25.7% to 25% in the third quarter.

"We are in fact creating jobs but not at the rate at which we said we will, but given our plans that we have said we will put in place, we are confident that we are going to create jobs," Zuma said.

Responding to a question from the Democratic Alliance on the implementation of the contested youth wage subsidy, Zuma said the government had held fruitful discussions with Cosatu, which objected to the measure.

"We have made a lot of progress with Cosatu on this matter."

Gordhan first mooted the R5bn subsidy in 2010 and said in February this year that it would be implemented over three years from April 2012.

DA parliamentary leader Lindiwe Mazibuko said the delay meant large numbers of young people had missed an opportunity to trade in poverty for gainful employment.

The subsidy would compensate employers for taking on young employees and can act to offset the costs of training or risk incurred by employers - especially those running small enterprises.

Zuma said the government could not rush the matter because democracy compelled it to consult with the "powerful" trade union federation.