South Africa’s unemployment rate declined to 25 percent in the second quarter as the government and the construction industry added more workers.
The jobless rate fell from 26.4 percent in the previous three months, Statistics South Africa said in a report released on Wednesday in the capital, Pretoria. The median estimate of seven economists surveyed by Bloomberg was 26.5 percent. The number of people without jobs decreased by 305,000 to 5.23 million.
Africa’s second-largest economy has struggled to boost employment since a 2009 recession and has the highest jobless rate of 65 emerging markets tracked by Bloomberg. Falling commodity prices and rising wage demands are curbing work opportunities, with at least seven listed mining companies announcing plans in the past two months to cut as many as 10,000 jobs.
Economic growth will probably accelerate to 2 percent this year, according to the government, from 1.5 percent in 2014, the slowest since the recession.
The number of people employed in community and social services, which includes the government, increased by 98,000 to 3.55 million. That makes it the biggest employer by industry.
Former Finance Minister Pravin Gordhan announced in October 2013 that the state would curb hiring to rein in surging staff costs. After the recession, the government started increasing spending and employment to boost growth.
The construction sector added 79,000 workers while the finance industry and manufacturing lost 31,000 jobs and 23,000 positions respectively. Mining added 3,000 jobs.
“There are always lags in these things,” Statistician-General Pali Lehohla told reporters. “There has been a lot of talk on mining retrenchments and so on, it hasn’t come through yet in the numbers.”
The government’s National Development Plan seeks to cut the jobless rate to 14 percent by 2020 and 6 percent by 2030.
“We should remind ourselves what the targets are against what the current performance is,” Lehohla said. “I can’t speculate on whether those targets can be met, but what we can see is that unemployment has remained stubbornly flat.”
South Africa’s unemployment rate will remain above 25 percent “unless major policy changes are implemented,” the International Monetary Fund said last month.
The unemployment rate is compiled from a household survey covering the formal and informal industries.
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