Job losses in South Africa's mining sector: A reflection of ongoing challenges

IOL News

2 days ago

The refining and smelting of gold to produce bullion bars. Gold mining employment in South Africa has fallen steadlly by some 135 000 since 1994.
Image: Supplied
Mining sector employment into the first quarter of this year has broadly followed the same downward trends as last year, where there were job losses among platinum group metals (PGM), diamond, and iron ore mining companies.
This was according to the Minerals Council South Africa (MCSA), the data from which showed there were 9 493 job losses in the PGM sector last year, 1 286 job losses in iron ore, while diamond mining employment was down by 1 047.
The MCSA's 70 members represent 90% of South African mineral production by value. By the end of 2024, there were 468 898 employees in the mining sector.
These three mining sectors measured by the MCSA with job losses were also those that were most affected by lower commodity prices last year, while South Africa's iron ore sector exports also suffered due to rail infrastructure problems.
Interestingly, employment in South Africa's gold mining sector fell by 2 296 employees, despite a high gold price that peaked at an all-time record last October, and the decline was reflective of broader structural problems, an MCSA spokesperson said.
Last year, coal sector employment increased by 2 213, employment in manganese mining was up by 416, while employment in chrome mining increased by 3 972. An estimated 5 744 jobs were lost in total in 2024.
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This was reflective of the need for a better regulatory and policy framework that would encourage further investment in mining, something that was still not evident in the Draft Mineral Resources Bill in its current form, an MCSA spokesperson said.
The MCSA said in a presentation to the Parliamentary Committee on Minerals and Petroleum Resources earlier this month that real mining GDP has declined in eight of the last 13 quarters - the standard definition of a technical recession is two consecutive quarters of GDP decline.
Overall mining production declined by almost 5% year-on-year, in real terms, in the first quarter of 2025, impacted also by heavy rains in January and February.
The MCSA told the committee that due to several binding constraints in the industry: electricity, poor rail and port performance, among others, production in the local mining sector was unable to respond to commodity price windfalls.
Total mining employment has declined by about 135 000 since 1994, with the decline reflecting mainly job losses in the gold sector, due to structural factors such as mature mines, declining reserves, and cost pressures.
BUSINESS REPORT