Economic growth ‘only way to solve SA’s jobs crisis’

The country's unemployment rate increased to 32.9% in the first quarter of 2025, up from 31.9% in the fourth quarter of 2024.

This is a one percentage point increase in the unemployment rate.

Statistics South Africa announced the Quarterly Labour Force Survey in Pretoria on Tuesday.

"Unemployment rose by nearly 300,000 persons in the first quarter of this year," Parsons said following the release of the latest stats.

"Although some sectors gained jobs, losses in others outweighed those gains. This is largely due to a combination of seasonal, cyclical, and structural factors that reflect how South Africa’s growth rate has been too low for too long."

With GDP expected to grow by only 1.5% this year, Parsons warned that the upcoming budget on May 21 must be "growth-driven and committed to the GNU’s 3% medium-term growth target" to unlock job creation opportunities.

Meanwhile, Standard Bank economist Elna Moolman warned that economic growth is the only way out of the crisis. 

"The Quarterly Labour Force survey reflects a rather bleak picture of employment in South Africa. It shows that, in the first quarter of this year, employment was only 43,000 higher than in the first quarter of last year. These jobs were all created in the informal sector, with a rather steep decline in formal, non-agricultural employment.

"When we look at employment relative to GDP, or if we look at private sector formal employment relative to the size of the economy, these indices are at reasonable levels in a historical context when we exclude crisis periods such as the pandemic and the global financial crisis. 

"In other words, employment seems to be at a reasonable level relative to the size of the economy, which implies that we need to grow the economy to justify further employment growth."

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