PwC focus on employment – 1 June 2021

Jobs recovery stalls in 2020Q1
PwC expects SA economy to create 384,000 jobs in remainder of 2021

Statistics South Africa (Stats SA) reported on June 1 that employment in South Africa declined by 28,000 jobs in the first quarter of 2021. The data indicated that after the country lost 2.2 million jobs in 2020Q2 and regained 876,000 of these during the second half of the year, job growth stalled in 2021Q1. There were likely some seasonal factors involved in the post-holiday quarter. As such, PwC expects the South African economy to create 384,000 jobs in the remainder of this year, and just over 300,000 during 2022. However, at this rate, we estimate that the total number of employed will only return to 2019 (i.e. pre-pandemic) levels by 2025

The official (narrowly defined) unemployment climbed from 32.5% in 2020Q4 to a new record high of 32.6% in 2021Q1. This was a much more moderate increase compared to a median forecast amongst economists of 33.4%. The smaller increase is attributed to 201,000 people who were looking for work in 2020Q4 shifting to the discouraged workers category – i.e. they have given up on finding a job – by 2021Q1. These 201,000 South Africans likely lost their jobs during the strictest levels of lockdown last year and were searching for a new job during the second half of 2020. In the absence of success, they have given up on again finding employment. As a result, the expanded unemployment rate - which includes discouraged workers – increased from 42.6% in 2020Q4 to 43.2% in 2020Q1.

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