Ashley Rekman | May 18, 2025
Last week, South Africa (STATSSA) announced an unemployment rate, showing levels reaching 32.9%.
Statssa's figures showed that unemployment is being driven by the formal sector, along with industries such as trade and construction that drive unemployment trends. On the contrary, transportation and finance benefited from net work.
Official unemployment rates rose as 291,000 people lost jobs in the quarter to quarter, dropping the labour force employed this March to 16.8 million, the South African Bureau of Statistics said on Tuesday.
Professor Raymond Parsons, an economist at the Northwest University (NWU) Business School, said the rising unemployment rate has sparked another red flag.
Parsons said, “A 1% rise in unemployment in the first quarter of 2025 will again raise another red flag about the weakness in SA's growth performance. It is not unexpected that 2025 GDP growth forecasts will gradually decline by various institutions and economists, and this will be reflected in the higher unemployment rate.”
“Currently, the overall unemployment rate is where it was a year ago, and the unemployment rate, especially for young people, remains an unacceptable magnitude. The latest increase in unemployment rates once again confirms that SA's economic growth is too long,” Parsons added.
South Africa's growth forecast is set to give his third budget speech after Finance Minister Enoch Godonwana's Value Added Tax (VAT) controversy that has plagued him all year round.
Without a rise in VAT, the minister is forced to restructure the budget, and it is expected that the growth forecast of the country, including spending, will be expected.
Parsons further stated that there is no magic wand to create work overnight.
“As with the disappointing disappointing unemployment picture, it is a cumulative result of seasonal, cyclical and structural factors. However, the worsening employment outlook reinforces the fact that the third budget of 21 must be growth-driven. It needs to create a policy environment that will enhance the policy environment that will promote economic expansion and support policies to boost investors' trust, to promote economic growth and increase investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors' trust, to support investors'
Economist Anchor Capital Casey Sprayke told the business report it is clear that SA continues to tackle unemployment rates with unrelenting rises and casts a shadow over the country's recovery efforts.
Sprake said, “While recent important reform measures show a more positive trajectory, this progress has yet to collapse into many South Africans in the form of employment opportunities. Structural challenges, such as skills gaps, labour market rigor, and the prolonged impact of the Covid-19 pandemic, are dependent on employment, particularly among sustained employment for employment, as a promotion of dependency on initiation, eroding the benefits of social stability and recent economic progress.”
“The combination of structural flaws such as lack of skills, limited access to quality education and training, and inadequate job creation has led to a large portion of the population not being able to find beneficial employment.
The unemployment rate among young people (ages 15-24) has once again risen to 62.8%.
“According to the expanded definition, the unemployment rate, including those who blocked seeking jobs and more reflect the actual number of unemployed South Africans, rose to an additional 43.1%.
“In addition, the domestic economy is not growing at a speed sufficient to sustainably increase the long-term employment outlook for South Africans, as material job creation is only occurring when GDP growth is approaching 3% PA. He further said.
“Disclaimer – the views and opinions expressed in this article are the views of the author and are not necessarily those of the Bee Room.”
