Adcorp: Gloomy outlook for jobs creation next year

2011-11-11 00:00

THE global uncertainty about the ­eurozone economy and the poor productivity of the South African workforce are surefire ingredients for bad employment prospects next year.

According to Adcorp’s Employment Index for October 2011, employment in South Africa was stable last month.

The index was weighed down by job losses in construction and manufacturing, but financial services and wholesale and retail trade expanded job opportunities.

Statistics South Africa said last week the country’s economy gained 193 000 jobs in the third quarter of 2011.

An additional 10 000 jobs were created in KwaZulu-Natal.

Adcorp’s labour market analyst, Loane Sharp, told The Witness yesterday he does not expect employment to grow significantly in the first three quarters of 2012.

A key reason for this is that labour productivity has recorded negative growth, of minus-one percent, this year.

Labour productivity is seen as a leading indicator of future job creation prospects.

“South Africa experienced a mild recession in 2008/2009, but shed one million jobs.

“Many of these jobs were not recovered,” said Sharpe.

This suggests that many of the former employees were not needed because the firms had learnt to cope without them.

Companies will only employ people if labour productivity is high.

“The trend has been for companies to use IT [information technology] and capital equipment instead of employing people,” said Sharp.

He expects mining, manufacturing and construction to offer little hope for employment next year.

Employment opportunities are expected to arise mainly in the retail and wholesale, services and professional services sectors.

Sharp said that although progress has been made in securing an agreement between the government, labour and business about labour broking, other issues like employment equity and collective bargaining have not been ironed out. He expects the deadlock to persist until 2013.

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