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While South Africans were optimistic that the economy was beginning to recover during the fourth quarter of 2020, new unemployment figures from Stats SA show that it was not, with another 701,000 people losing their jobs.
A total of 11.1 million people are now unemployed in the country.
A total of 1,397 million people lost their jobs in 2020, with the unemployment rate now at 32.5%, compared with 30.8% in the third quarter. Compared to a year ago, the number of unemployed increased by 7.5% (507,000), while the number of people who were not economically active increased by 9.5% (1.5 million).
READ ALSO: Unemployment up 43% in the third quarter of 2020
Professor Jannie Rossouw from Wits Business School says she is concerned that the unemployment rate will continue to rise, because this means that more people will not be able to pay taxes.
“The government will have to be very careful not to overestimate its tax revenue in the future. It is also worrying that economic growth is not keeping pace with population growth of 1.5%. The only thing that can save us is to make it easier to hire people, ”he says.
The number of discouraged job seekers increased by 235,000 (8.7%) and the number of people who were not economically active for other reasons decreased by 1.1 million (7.4%) in the third and fourth quarters, which which resulted in a net decrease of 890,000 in the non-economically active population.
Stats SA said that this movement was proportionally more towards the unemployed than towards the employed, resulting in a significant increase of 1.7 percentage points in the official unemployment rate, and the unemployment rate under the expanded definition of unemployment decreased only by 0.5 percentage points. to 42.6% in the fourth quarter from the third.
The working-age population increased by 143,000 (0.4%) quarter-on-quarter and, compared to the fourth quarter of 2019, by 583,000 or 1.5%. The number of people employed increased by just 333,000 to 15 million in the fourth quarter of last year.
Employment increased in these sectors
The largest increases in employment were in the formal sector (189,000), followed by private households (76,000), the informal sector (65,000), and the agricultural sector (2,000). The number of people employed increased in eight of the 10 industries surveyed.
ALSO READ: GDP growth does not mean increased employment, says labor department
The largest increase was registered in social and community services (170,000), followed by construction (86,000) and private households (76,000). The only decreases were in finance (123,000) and mining (35,000).
Decrease in employment in these sectors
There was a 1.4 million decline in total employment year-over-year, with 256,000 people in the financial industry losing their jobs, 241,000 in community and social services, 230,000 in manufacturing, 186,000 in commerce, and 184,000 in construction .
Informal and formal sector
Employment in the informal sector stood at 176,000 in the third sector and showed an increase of 65,000 in the fourth quarter, while employment in the formal sector also increased by 189,000.
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