JOHANNESBURG, 1 JUNE 2021 – The Quarterly Labour Force Survey (QLFS) data released today by Statistics South Africa (Stats SA) indicating unemployment level of 32.6%, reflects the deep depressed impact of COVID-19 lockdown on South African employment and the overall economic environment across major economic sectors, the Steel and Engineering Industries Federation of Southern African (SEIFSA) said today.

According to StatsSA, South Africa’s unemployment rate rose to 32.6% in the first quarter of 2021 from 32.5% in the previous quarter. It is the highest jobless rate in the 13 years and comes amid the ongoing pandemic lockdown, which has contributed to the depressed economic environment, resulting in low investment activity. The level of unemployment in South Africa is far above other economies such as Brazil (14.7%), China (5.3%), India (6.5%) and Russia (5.2%); which are in an economic development partnership.

Construction recorded the biggest employment decline  with 87 000 jobs lost, followed by trade (84 000) and private households (70 000).

SEIFSA Chief Economist Chifipa Mhango said number of jobs in key demand-driving sectors of the Metals and Engineering sector such as construction is worrying. He said the Government and the private sector need to work together to stimulate the economy and create jobs. “Investment-driven economic recovery is key and the Government needs to promote investor confidence by speedily implementing its economic revival plans, including  the R791.2 billion of public sector infrastructure development over the next three fiscal years,” Mr Mhango said.

He said the contribution of the M&E sector remains key to job creation, yet it shed 35 000 last year alone. Persistent challenges faced by businesses in the M&E sector such as high electricity costs, unreliable energy supply as well as disruptions in raw material supply, rising logistics costs and imports have continued to weigh negatively on the industry, thus affecting job creation in manufacturing as a whole. “It is, therefore, important that the Government and the sector continue to engage with each other on how to address these challenges,” Mr Mhango said, adding that it is such partnerships that will also ensure that other interventions such as the Steel Master Plan are quickly finalised and implemented.