Economists and trade unionists have welcomed the drop in the unemployment rate to 24.0% in the fourth quarter from 25.3% in the third quarter as 157000 jobs were created, but the number of economically inactive people rose by 222000, to a record 14.9 million.
Cosatu spokesperson Patrick Craven said: “We are relieved that at long last there has been a reversal in the trend of job losses, and welcome the drop in the unemployment rate.
“However, it is still far too early to celebrate because the increase in jobs in the fourth quarter may just be seasonal and we need to see the first-quarter data before we can see that a trend of job creation has been established.”
Craven said the labour body was concerned about the rise in the number of economically inactive people, because that “shows that not enough is being done to create jobs, which remains at the heart of our campaigns”.
The number of people who are not economically active has increased by 711000 between the fourth quarter of 2009 and the fourth quarter of last year.
The almost 15million people who are not economically active exceed the number of those employed by almost twomillion.
The biggest proportion of economically inactive are those people at school or studying, at 6.25 million, because the labour force is defined as those aged from 15 years to 64 years old, even though legislation prevents anybody from legally hiring a person aged younger than 16 years old.
Homemakers are the next largest category at just less than three million, then those workers who have given up looking for work, termed “discouraged workers” come in at 2.15 million.
Economist Mike Schussler of economist.co.za said: “The drop in the unemployment rate is welcome, but is also partially more of a statistical quirk because the labour force declined by 102000 when more workers became discouraged, even as the population aged 15 years to 64 years old increased by 121000.”
In terms of sectors, most of the 157000 job gains in the fourth quarter were in the public sector as community and social services jobs increased by 148000 of the job gains.
The manufacturing sector followed with 70000 and then the distribution and trade sector with 28000.