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The Citizen
17 hours ago
- Business
- The Citizen
Agriculture sector sheds 24 000 jobs during second quarter
Agriculture was among the hardest-hit sectors in the second quarter (Q2) of 2025's employment statistics, placing joint second for the most jobs lost between April 1 to June 30 compared with the first quarter of the year. Agriculture and finance each shed just over 24 000 jobs in Q2 2025, while the community and social services sector lost 42 000, according to data released by Statistics South Africa (Stats SA). However, Thanda Sithole, senior economist at FNB, noted in a press release that the 905 770 jobs the agriculture sector created in Q2 2025 was still 9 845 more year-on-year. Farmer's Weekly reports the overall unemployment rate was up by 0,3 percentage points, rising from 32,9% to 33,2%, with unemployment being the highest in North West at 40,1%, followed by the Eastern Cape at 39,5%. Stats SA's Quarterly Labour Force Survey is not seasonally adjusted, hence it reflects seasonal fluctuations in employment that follow the production cycles of various agricultural commodities. Seasonal shifts and disease outbreaks behind job cuts Dawie Maree, head of agriculture information and marketing at FNB, ascribed the reduction in employment in Q2 to the late start of the summer rains, which also delayed the start of the citrus season – a major employer of seasonal labour. 'Although the grain sector isn't a big employer of seasonal labour, it still has a measure of seasonality, which would have contributed to the downward trend. Another contributor would have been the outbreak of foot-and-mouth disease, which may not have shaved off a large number of jobs if you look at the overall livestock sector, but it did play a role,' he said. Maree added that he expected this drop in the sector's employment to be reversed in the third quarter, as the late summer rains at the start of the year had already contributed to an uptick in employment across the various production industries. Statistician-General Risenga Maluleke pointed out that over the decade, the Western Cape's unemployment rate had consistently remained below South Africa's national average, while the Eastern Cape had consistently recorded unemployment rates above it. Regional unemployment trends reveal stark contrasts Between April and June 2025, unemployment rates in the Northern Cape and Western Cape were below the national average of 33,2%, at 32,7% and 21,1%, respectively. However, the Western Cape also recorded the biggest quarterly drop in employment, falling by 117 000 jobs from the first quarter (Q1) to Q2, followed by KwaZulu-Natal with 86 000 fewer jobs, and the Northern Cape with 28 000 fewer. The biggest gains were in Gauteng, which added 95 000 jobs, and the Eastern Cape, which added 89 000. Unemployment stood at 38,5% in the Free State, 35% in Limpopo, 34% in Mpumalanga, 33,8% in Gauteng, and 33,4% in KwaZulu-Natal. The sectors that added the most jobs in Q2 were trade, which gained 88 000; private households, up by 28 000, and mining, which increased by 000. Employment in the formal sector comprised 11,5 million jobs, or 68,2% of total employment, compared with 3,3 million (19,8%) in the informal sector, 1,1 million (6,6%) in private households, and 906 000 (5,4%) in agriculture. Sithole pointed out that youth unemployment remained 'critically high', with the jobless rate for 15- to 24-year-olds at 62,2% in Q2, compared with 62,4% in Q1, and 60,8% in the fourth quarter (Q4) of 2024. Among 25- to 34-year-olds, unemployment stood at 40,5% in Q2, compared with 40,4% in Q1 and 41,7% in Q4 2024. 'This underscores the urgent need to accelerate pro-growth structural reforms that can drive sustainable and inclusive economic expansion. Government's diplomatic stance in the wake of the US's 'Liberation Day' tariffs remains critical to mitigating potential job losses stemming from the effects of these steep tariffs on South Africa's [access to] the US market,' Sithole said. Breaking news at your fingertips… Follow Caxton Network News on Facebook and join our WhatsApp channel. Nuus wat saakmaak. Volg Caxton Netwerk-nuus op Facebook en sluit aan by ons WhatsApp-kanaal. Read original story on
The Citizen
5 days ago
- Business
- The Citizen
Unemployment could get even worse in third quarter due to US tariffs
SA's already-high unemployment rate increased to 33.2% as the number of unemployed individuals shot up by 140 000. After the shocking announcement on Tuesday that the South African unemployment rate increased again in the second quarter of the year, economists are now warning that it will be even worse in the third quarter due to US tariffs and domestic politics. Jee-A van der Linde, senior economist at Oxford Economics Africa, says while the latest job numbers reflect the impact of tariff uncertainty, the actual economic impact of the 30% US tariff will only reflect in the next round of employment data. 'The 1.7% increase in the number of unemployed people in the second quarter aligns with the decline in second-quarter business sentiment. Companies faced heightened uncertainty relating to US tariffs and domestic politics. ALSO READ: Unemployment increases again as economy sheds 140 000 jobs 'With the 30% US import tariff having come into effect on 7 August, there is a risk that the employment numbers for the third quarter could reflect even more economic strain. Companies will likely be compelled to scale back employment and investment plans as they traverse an uncertain economic landscape while trying to maintain competitiveness in the US market, which previously provided tariff-free access.' He says although recent economic data releases point to improved manufacturing and mining activity during the second quarter, these follow a poor performance at the beginning of this year. 'This does not change our view that the business environment has improved to the extent that economic growth will pick up meaningfully in the near term.' Deterioration in economy's ability to create jobs Thanda Sithole, senior economist at FNB, noted that the absorption rate decreased further by 0.1 percentage points to 40.2%, suggesting a moderate deterioration in the economy's ability to create jobs during the second quarter. 'At this rate, a significant proportion of the working-age population is still left out of the formal economy, emphasising the need for faster and labour-intensive growth.' She also points out that the critically high unemployment for the youth, standing at 62.2% for people between the ages of 15 and 24 and at 40.5% for those between the ages of 25 and 34, underscores the urgent need to accelerate pro-growth structural reforms that can drive sustainable and inclusive economic expansion. 'Government's diplomatic stance in the wake of the US 'Liberation Day' tariffs remains critical to mitigate potential job losses stemming from the effects of steep US tariffs on South Africa's entry into the US market. 'While the US remains an important trading partner, accounting for 7.5% of South Africa's total merchandise exports, efforts to diversify export markets across regions must be intensified to cushion the economy against the potential impact of bilateral tariffs imposed by the US.' Sithole says the improvement in employment in the second quarter aligns with expectations of further gross domestic product (GDP) growth. 'However, the persistently high unemployment rate highlights the continued vulnerability and weakness of the labour market. 'This is further compounded by heightened uncertainty over the potential employment impact of US tariffs on sectors such as agriculture, automotive, machinery and equipment manufacturing and mining (excluding critical minerals producers). Over the medium term, sustained structural reforms and accelerated efforts to diversify export markets should help support job creation.' ALSO READ: Increased unemployment rate red flag for weak economic growth Unemployment could increase due to US tariffs Busisiwe Nkonki, Johannes (Matimba) Khosa and Nicky Weimar, economists at the Nedbank Group Economic Unit, also say that the outlook for the labour market remains uncertain. 'The easing logistical constraints, more stable power supply and improving consumer spending will somewhat support employment. 'However, employment growth will be partly offset by the anticipated deterioration in global trade conditions due to the US tariff policies. Although the US imposed a 30% reciprocal tariff on South African exports from 7 August, government is still trying to negotiate a better rate. 'Either way, tariffs are set to stay and some export-oriented industries will feel the pain. The agricultural and automotive sectors will be most affected. Within agriculture, the citrus exporters will be hit the hardest. 'This will undermine the benefit from favourable weather conditions, which are expected to support crops and underpin higher activity in the next harvest season. The steel and aluminium sectors will also be affected as they form part of the components supply chain.' The Nedbank economists expect that employment in general government will continue to be undermined by fiscal constraints. Overall, they forecast economic growth to remain subdued this year, averaging 1% before increasing slightly to 1.6% over the next three years. 'With this muted growth, it will be difficult to reduce the unemployment rate significantly in the short term, given the fast-growing labour force.' ALSO READ: US tariff of 30%: Rand weakest in 3 months, thousands of jobs in danger Dampened consumer spending and constrained economic growth Adriaan Pask, CIO at PSG Wealth, says South Africa's persistent high unemployment rate is likely to dampen consumer spending and constrain broader economic growth prospects. 'These challenges continue to place significant pressure on policymakers to introduce and accelerate reforms aimed at fostering sustainable job creation. 'Our investment solutions are carefully positioned with leading active managers who possess the expertise and agility to capitalise on emerging opportunities while effectively managing risks associated with a difficult economic environment.' ALSO READ: Is South Africa's unemployment rate really only 10%? Informal employment In addition, Sithole noted that Statistics SA plans to revise its questionnaire ahead of the third quarter publication to adapt the survey to a rising trend of informal economic participation and dynamic labour market trends exacerbated by the pandemic. 'In line with this, people who are not in the labour market will not be assumed to be economically inactive and the questionnaire may consider different forms of employment agreements and benefits.' Sithole says the survey may also remove restrictions such as the age limit of 64 years, considering that people are working longer. 'We look forward to these adjustments and how they bring us closer to a fair reflection of the labour market in South Africa. 'Labour data is key to policymaking and business strategy and should be in line with international best practise in order to be considered credible and comparable.'
