SA employers cautious on hiring in the next 3 months - report

South African employers intend to have a conservative hiring strategy for the next three months, according to the recently released ManpowerGroup Employment Outlook Survey.

Representatives of 752 employers in SA took part in the survey. They were asked how they anticipate total employment at their company to change in the three months to the end of March 2019, compared to the fourth quarter of 2018.

The survey found that 11% of employers expect to hire more people in the first quarter of 2019 compared to the fourth quarter of 2018; 6% anticipate a decrease and 81% forecast no change.

Lyndy van den Barselaar, managing director of ManpowerGroup SA, explains that SA employers are reporting conservative hiring intentions for the January to March time frame, because the country's economic growth continues to be slower than expected in the short- to medium-term.

This means businesses have to be cautious when it comes to spending, and hiring activity and could explain why more than 80% of employers reported no change to their hiring strategies in the coming quarter.

Regional comparisons

The survey indicates the strongest hiring activity is anticipated in the Eastern Cape, where the Net Employment Outlook stands at +8%.

A moderate hiring activity is also forecast for Gauteng and the Western Cape, with outlooks of +7% and +6%, respectively.

The hiring outlook for Kwazulu-Natal is +1%, while Free State employers expect to trim payrolls, reporting an outlook of -2%.

"The Department of Economic Development, Environmental Affairs and Tourism indicated in a report in October that there had been steady growth in the Eastern Cape, in sectors such as agro-processing, energy, general manufacturing and pharmaceutical products," says Van den Barselaar.

"The report also found that the automotive sector remains the Eastern Cape's leading exporter. This positive growth could mean that businesses will need to take on additional employees in the coming quarter."

Sector comparisons

Workforce gains are anticipated in seven of the 10 industry sectors during the next three months. The strongest labour markets are forecast for the wholesale and retail trade sector and the transport, storage and communications sector.

"The wholesale and retail trade sector often experiences an uptake in the first quarter as the holiday season comes to an end and as consumers make their last holiday purchases and take advantage of post-Christmas sales; which could explain the positive hiring intentions of employers operating in this sector," says Van den Barselaar.

Moderate hiring prospects are indicated in the agriculture, hunting, forestry and fishing sector and the mining and quarrying sector, the survey shows.

The restaurants and hotels sector employers report an outlook of +5%.

Payrolls are forecast to decline in the manufacturing sector, where the outlook stands at -6%.

Large employers report favourable hiring prospects, with a net employment outlook of +16%, while outlooks of +7% and +3% are reported by medium- and small-size employers, respectively.

Micro employers anticipate an uncertain hiring climate, reporting an outlook of -1%.

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