Risenga Maluleke’s Perspectives on the Growing Unemployment in South Africa

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JEREMY MAGGS: South Africa’s employment landscape is poised for change, at least statistically. Statistics South Africa (Stats SA) is revamping its Quarterly Labour Force Survey starting this third quarter, refining how it evaluates informal employment and underemployment. The goal, as I understand, is to provide a clearer picture of the evolving labor market, incorporating street vendors and gig workers in accordance with global standards.

I’m eager to discuss this topic, but today’s newly released employment data provides a final glimpse into trends before this new methodology is implemented. I’m currently speaking with Statistician-General Risenga Maluleke. Welcome, Risenga. Let’s begin with today’s figures. The unemployment rate has climbed to 33.2%. What do you think is causing this rise, even as it appears more people are securing jobs?

RISENGA MALULEKE: Jeremy, it’s essential to note that factors influencing employment gains or losses differ from quarter to quarter. However, we have observed a consistent upward trend in unemployment in our country.

This quarter, a significant factor for the rising unemployment is the influx of individuals entering the job market, particularly from high schools and universities earlier this year. Nonetheless, the corresponding number of employed individuals has seen minimal growth.

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In the first quarter, we had 16.8 million employed individuals, with a mere increase of 19, still leaving us at 16.8 million. Conversely, in the first quarter, we recorded 8.2 million actively job-seeking unemployed individuals; that figure rose by 140,000 to 8.4 million.

This indicates that we’ve experienced a rise in the number of individuals actively seeking jobs, outpacing the growth in employment, leading to the unemployment rate ticking up by 0.3 percentage points to 33.2%.

JEREMY MAGGS: If we have fewer discouraged job seekers, shouldn’t that result in a more pronounced decrease in unemployment?

RISENGA MALULEKE: You need to remember that the headline rate of 33.2% does not consider discouraged job seekers.

The number of discouraged job seekers was 3.5 million, which decreased by 28,000 to 3.4 million.

However, those discouraged job seekers are now actively searching for employment. The headline unemployment rate solely reflects those actively seeking jobs.

When we combine the 8.4 million actively seeking employment with the 3.4 million discouraged job seekers, plus another 800,000 who didn’t seek work for various reasons—not just discouragement—we arrive at a total of 12.6 million. This figure represents what we call the expanded unemployment rate, which stands at 42.9%.

JEREMY MAGGS: A persistent concern is the youth unemployment rate, which remains at 46.1%. I’d like to understand why it hasn’t changed, even though more young people seem to be finding work, according to the data.

RISENGA MALULEKE: It’s important to recognize that youth are often drivers behind the increases in unemployment numbers.

Each year, we see an influx of young people entering the job market. Whether they secure jobs or not varies. Many will pursue education, but if they don’t gain admission, they begin to search for work. This can lead to a rise in unemployment if they are unable to find jobs, or sometimes their rate will remain steady from quarter to quarter.

JEREMY MAGGS: Looking at this from a provincial angle, Gauteng and the Eastern Cape are seeing job gains, while the Western Cape and KwaZulu-Natal report steep losses. Can you briefly explain these significant provincial differences?

RISENGA MALULEKE: Each province has distinct economic characteristics affecting employment. For instance, Gauteng and the Western Cape stand out as the strongest economies, heavily driven by finance, real estate, and business services.

Following that, retail occupies a central role, particularly in city centers. The Western Cape also benefits from a robust agricultural sector, but contrasts emerge when agriculture in that region lost 24,000 jobs. In total, the Western Cape experienced a loss of 117,000 jobs.

Listen/read: Youth unemployment crisis: 10.3 million young people jobless.

In contrast, Gauteng—while it doesn’t have much in terms of trade—has seen job gains driven by its larger population and household dynamics, leading to an 88,000 job increase in trade, along with another 28,000 from private households.

JEREMY MAGGS: Turning to the Quarterly Labour Force Survey, there are significant changes in the questionnaire. How will these alterations affect our understanding of unemployment, especially among young individuals?

RISENGA MALULEKE: I don’t believe the updates to the questionnaire will alter the overall number of jobs created or lost. Instead, these changes will primarily enhance our ability to analyze issues related to unemployment and underemployment.

Listen/read: Rethinking career guidance to address SA youth unemployment.

So, just to clarify: it’s similar to a community where 100 are employed and 10 are unemployed; asking further questions won’t change those numbers, but will improve our understanding of the characteristics of those groups.

JEREMY MAGGS: Was there any pressure to modify the survey format due to critiques from the former CEO of Capitec, Gerrie Fourie?

RISENGA MALULEKE: Absolutely not, Jeremy. Our adjustments have been ongoing as part of the International Labour Conference, and improvements have been made since we launched the Labour Force Survey nearly two decades ago, particularly since 2008.

What we must emphasize, as Stats SA, is that while we value public feedback, criticisms do not imply that our numbers are flawed. They offer an opportunity to clarify our methodologies and discuss enhancements, but they don’t drive our decisions.

A misstep we can’t afford as a nation is to think that we are without a significant unemployment issue.

Stats SA’s responsibility is to provide an objective picture of the situation. We must not yield to external pressures.

JEREMY MAGGS: The critical importance of presenting unvarnished facts cannot be overstated. Thank you for your insights, Statistician-General Risenga Maluleke.

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