A new report just released by the Department of Labour has revealed that a worrying factor of South Africa’s labour market is, that unemployment among the educated is increasingly becoming a phenomenon.
According to the job opportunities and unemployment in the South African Labour Market report, while the South African education system has undergone several reforms to include a large number of citizens, the benefits are not directly observed in the labour market.
The report reveals that unemployment is high among people with no tertiary qualification and low among people with tertiary qualification.
“When it comes to laying-off employees when companies are in economic or financial crisis where people with less education and little experience are normally the first ones to be laid-off as opposed to people with higher levels of education,” said the report.
Abrahams Mutedi, director of Labour Market Information and Statistics at Department of Labour said the rise in the ‘army’ of unemployed among the educated was a reflection of a growing mismatch persistent in the labour market.
“What employers are looking for in terms of educational levels and skills does not match what is available in the labour market,” he said.
Mutedi said from the data captured, there has been a shift in the economy over the past decade or so towards high tech and services industries.
The Job Opportunities and Unemployment in the South African Labour Market report captures vacancies and Unemployment insurance claims in the period April 2010-March 2011. The report was first released in the 2005/06 period.
Mutedi said the report shows the level of skills needed in the South African labour market based on the job vacancies trends. He said it reflects on the labour market dynamics between demand and supply of labour and also help policy makers especially in areas of economic management, employers, and stakeholders in education among others.
On the other hand, job seekers and students can use this data to make informed decisions about their future education, training and career changes.
Turning to the report, it shows that the number of vacancies captured has been fluctuating on quarterly basis in the financial year 2010/11. It increased from quarter three (12 172) to quarter four (13 636) after a decreased from quarter two (21 213) to quarter three (12 172) in the financial year.
The data further indicates that more than 90 percent of vacancies were permanent jobs in the Community, social and services sector. On the other hand, the Department of Labour created 581 427 new ordinary claims for UI benefits over the same financial period. A decreased of 44 739 UI ordinary claims from the last financial year.
The high percentage of full-time jobs is a good sign in a country like South Africa where casualisation has increased as reflected in the Unemployment Insurance Fund(UIF) data, said the report. Another point to note is that the increase in the number of vacancies does not necessarily mean that the economy is creating new jobs.
The report said managers are the only occupational group that recorded an increase throughout all the four quarters. The number of people employed in the managers occupational group increased by 136 000 from 1 000 000 in quarter one of 2010 to 1 136 000 in quarter one of 2011.
Between quarter four of 2010 and quarter one of 2011, jobs were largely created in the craft and related trade (55 000), sales and services (22 000) and manager (12 000) occupational categories.
On the other hand, the clerks, skilled agriculture and professional recorded a decrease of 93 000 and 12 000 respectively. The year-on-year picture between quarter one (January-March) 2010 and quarter one (January-March) 2011 shows that the number of women employed decreased by 22 000 whereas the men increased by 63 000.
The data has continued to expose the fragility of the youth in the labour market as highlighted in the previous reports and the global employment trends for the youth reports.
As reflected in the Quarterly Labour Force survey report, it is understood that “ a slow growth in employment will bring constraint to human development and economic progress,” said the report, that it should be a matter of concern for the South African Government regarding the capacity of job seekers, in particular new entrants to effectively participate in the economy.
The main concern here is that more and more people remain unemployed for periods longer than one year said the report that long-term unemployment may create problems for the individuals themselves and the overall economy. It rests on the shoulders of the Government to provide training to these people in line with the shift of the South African economy from primary to services industry which skills are mostly required by employers, said the report.
Recently, many South Africans had high expectations with regard to the labour market outcomes in the country. With the 2010 FIFA Soccer World Cup being hosted on South African soil, many people expected the World Cup to produce a positive economic impact and other associated benefits in terms of employment and business opportunities especially the Small Medium Enterprises (SME’s).
The data shows that although there was positive economic growth, it was not accompanied by a large number of people being employed. The quarter two gross domestic product (GDP) figures shows that growth slowed to 3.2% from 4.6% in quarter one of 2010.
This was accompanied by a decline of 61 000 in employment. Growth further slowed down to 2.6% in quarter three of 2010, with employment declining by 86 000 in the same quarter. In quarter four of 2010, the GDP strengthened sharply to 4.4% and this was accompanied by massive job gains (157 000). In quarter one of 2011, the economy strengthened further by 4.8% but employment decreased by 14 000 in the same quarter.
The report said what was needed are Government interventions that can produce sustainable jobs to promote economic growth. Another intervention entailed institutional reform to address weaknesses that constrained the country’s growth potential, such as the way Government is organised; the capacity of Government to deliver and leadership in policy development and implementation.
The report concludes that the high unemployment rate remains SA’s major economic challenge and there are no short-term solutions to the problem except to acknowledge that the New Growth Path (NGP) is targeting about 5 million new jobs by 2020 and Government leading the way by declaring 2011 a year of job creation through massive investment in fixed and human capital.
Our policies should be redirected to the South African youth (15 to 34 years) who remain the most affected as many portray a mismatch of skills against what is required in the labour market. However, the report has shown that there is a high concentration of vacancies in the high-skilled occupational groups (managers and professionals).
According to the report there is a need for the Department of Labour to drive the process of reducing unemployment in South Africa especially among the youth through the Public Employment Services (PES), an initiative which matches unemployed with prospective employers.
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