Unemployment Rate In South Africa Rises To 44.4%

Bloomberg reports that the unemployment rate in South Africa has surged to the highest on a global list with 82 countries.

According to Statistics South Africa, the unemployment rate rose from 34.4% to 44.4% in the second quarter of the year. In the first three months through March, the unemployment rate was 32.6%.

Due to tightening Covid-19 restrictions in the face of a massive third wave of the virus and the eruption of deadly riots in July, experts claim unemployment data would likely deteriorate in the third quarter of the year.

Deadly riots broke out in the Gauteng and KwaZulu-Natal provinces of South Africa in July, which claimed 354 lives and saw thousands of businesses looted and shuttered. The unrest cost the country about 50 billion rands ($3.3 billion) in lost output and placed at least 150,000 jobs at risk, according to the South African Property Owners Association.

The unemployment rate in South Africa’s economy has been above 20% for at least two decades, even though output expanded by 5% or more a year in the early 2000s.

South African companies’ ability to hire is undermined by an education system that doesn’t provide adequate skills, and strict labour laws that make hiring and firing workers onerous. The apartheid-era strategy of placing so-called townships, where many Black citizens were compelled to live, on the periphery of cities also makes it difficult for residents to access the formal jobs market.

Key Figures:

• The finance industry lost 278,000 jobs.
• Community, social services lost 166,000 jobs.
• Manufacturing lost 83,000 jobs.
• Construction added 143,000 jobs.
• Agriculture added 69,000 jobs