GNU clueless on how to tackle unemployment
Image: FILE
THE increase in the official unemployment rate from 31.9% to 32.9% exposes the Government of National Unity's (GNU) "investment conferences" as gimmicks that only serve to create false sense of hope.
That is how some unions reacted to news the official unemployment rate moved upwards because 291 000 people lost their jobs quarter-on-quarter, dropping the employed workforce to 16.8 million as of March this year.
Statistics South Africa released its latest unemployment figures on Tuesday, showing that there was an increase of 1.3 percentage points of people entering the workforce, or 532 000 more working-age South Africans, which resulted in there also being more unemployed people. That figure is now 8.2 million.
StatsSA also noted that those aged between 15 and 34 years remained the most vulnerable in the job market, with both work losses and an increase in unemployed youngsters pushing that unemployment rate up to 46.1% from 44.6% quarter-on-quarter.
'The youth (15–34 years) remain vulnerable in the labour market. The results for the first quarter of 2025 show that the total number of unemployed youth increased by 151 000 to 4,8 million, while employed youth recorded a decrease of 153 000 to 5.7 million. As a result, the youth unemployment rate increased from 44.6% in the fourth quarter of 2024 to 46.1% in the first quarter of 2025,' said StatsSA.
South African Federation of Trade Unions (SAFTU) general secretary Zwelinzima Vavi said the figures underscored the deepening crisis confronting the working class and the urgent need for a radical shift in the country's macroeconomic trajectory.
'These figures are a damning indictment of South Africa's failed capitalist economic system — a system incapable of delivering decent work, reducing inequality, or ending poverty. They also expose the complete failure of the government's macroeconomic policies, which continue to serve the interests of big business and the wealthy elite, while abandoning the working class and the poor.
'The government's dogged commitment to fiscal austerity and neoliberal orthodoxy has led to the disinvestment in vital sectors such as manufacturing, agriculture, and public services, resulting in job losses, factory closures, and economic stagnation.'
Vavi said the second phase of Operation Vulindlela, launched by President Cyril Ramaphosa last week was the latest neoliberal scheme to attract private investment — premised on de-risking and privatising strategic sectors.
'As with GEAR, AsgiSA, and other failed frameworks, Operation Vulindlela will not deliver the promised jobs or industrialisation.'
His remarks were echoed by Saftu's affiliate, the General Industries Workers Union of South Africa (Giwusa), whose president Mametlwe Sebei the GNU was not the right vehicle to steer the country out of the crisis.
'The so-called GNU continues to implement the same austerity measures, privatisations, and attacks on workers' rights that have led us to this disaster. The latest Quarterly Labour Force Survey reveals GNU and capitalism's brutal assault on the working class. The so-called "recovery" is a myth and false excitement about GNU and business confidence are misplaced as we argued. We're now back to the same 32.9% unemployment rate as Q1 2024, showing capitalism's complete inability to create lasting jobs and GNU impotence in the face of this crisis.'
DA spokesperson on employment and labour Michael Bagraim said his party's reform proposals and bold agenda should be front and centre to reverse thesituation.
'A job is more than income, it is hope for the future, security and dignity. This is why the DA's primary focus, and the DA's most important policy agenda in the GNU is to facilitate economic growth for all South Africans, and to do everything we can to foster job creation. Our country needs a growth agenda that unlocks barriers to investment, such as eliminating job quotas and economic and labour regulations that protect narrow interests and not all South Africans.'
Delivering a keynote address during a memorial lecture honouring Struggle icon Duma Dokwe, ANC secretary General Fikile Mbalula, said: 'It is our contention as the ANC that the national budget must reflect a growth path that would ensure adequate absorption of the unemployed through economic opportunities for entrepreneurs and expansion of existing businesses…Our young people must embrace the philosophy of lifelong learning in order to become agents for transformation who have the necessary capacity to decisively tackle the triple challenges of poverty, unemployment and inequality.'
Additional reporting Nicola Mawson.
Cape Times
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Citizen
7 minutes ago
- The Citizen
Employed South Africans working hard for financial freedom
South Africans are known for their resilience which is confirmed by a survey that shows they still work hard for their financial freedom. Employed South Africans are working hard for their financial freedom according to a new survey that shows their resilience and renewed sense of optimism despite the persistent pressures of a challenging economic climate. According to the 2025 Old Mutual Savings & Investment Monitor (OMSIM), many consumers are not only hopeful about the future but are also taking deliberate steps to improve their financial wellbeing. The OMSIM is an annual study that tracks the financial attitudes, behaviours and priorities of working South Africans earning a minimum of R8 000 per month. It serves as a barometer for the country's financial health, capturing the lived experiences and evolving behaviours of the middle-income market. The 2025 findings tell a story of adaptation, resourcefulness and a steady shift from crisis management to more forward-looking financial behaviour. ALSO READ: South Africans experiencing less financial stress, but still under pressure — survey Finances still difficult for working South Africans despite progress Vuyokazi Mabude, head of knowledge and insights at Old Mutual, says this year's report is a reflection of a turning point. 'The results show that while life is still difficult for many people, working South Africans are making tangible progress. 'There is a notable increase in income, confidence and an entrepreneurial spirit, particularly among the youth. People are taking control of their finances, seeking out additional income sources, managing their debt more intentionally and placing greater importance on saving,' she says. One of the standout findings is the marked improvement in financial sentiment, Mabude points out. A remarkable 75% of respondents believe their personal financial situation will improve in the next six months, the highest recorded since the Covid-19 pandemic in 2020. 'This level of optimism is most pronounced among the Gen Z market, with 89% anticipating improvement in their finances. Confidence in South Africa's economic direction is also improving, although consumers are still cautious. 'The number of people who expressed confidence in the economy has grown to 42%, building on the slow but consistent recovery seen since 2023.' ALSO READ: Survey shows how economic distress erodes South Africans' savings culture Income of working South Africans improving as well She says alongside improving sentiment, income growth is becoming more evident, where 44% of respondents reported earning more than they did a year ago, with income increases especially common among the youth (55%) and those in higher income brackets (57%). It is clear from the survey that South Africans are not simply working one job anymore, with 'poly-jobbing' the new normal now. The report shows that side hustling and entrepreneurship have become deeply embedded in the financial lives of working South Africans. The number of 'poly-jobbers', who earn income from multiple sources, remains high at 57%, rising to 75% among the youth between the ages of 18 and 29. In fact, Mabude says, the report shows that almost half of working South Africans (48%) now own or part-own a business. 'This entrepreneurial spirit is not just a trend. It is proving to be a vital coping mechanism and a source of financial empowerment. People are using their skills and passions to diversify their income streams, often out of necessity, but increasingly also as a means to build wealth.' ALSO READ: Tips on how to build your savings and become financially resilient Working South Africans struggle with debt and gambling However, with all the good news there is bound to be bad news. South Africans are struggling with debt and gambling. Debt continues to feature prominently in household financial management, but it is encouraging that 57% of respondents say they reduced their debt compared to a year ago. A growing number (32%) proactively engaged with creditors to renegotiate repayment terms. However, there are areas of concern, Mabude says, pointing out that 52% of working South Africans reported that they gamble, with 40% admitting they do so in hope of covering expenses or repaying debt. 'This trend suggests that while some are making proactive choices, others remain vulnerable and are turning to risky behaviour to bridge financial gaps.' The report also shows some lag when it comes to long-term savings. Although South Africans continue to show strong short-term saving habits with an average of 22% of household income being allocated to savings, retirement planning remains on the downside. While 96% agree that saving for retirement is important, only 28% made it a top priority. 'It is also encouraging to note that fewer people are prematurely accessing investments or retirement funds, while informal savings vehicles, such as stokvels remain popular and trusted,' Mabude says. ALSO READ: Only 8% of women are confident about retirement – are you one of them? Optimism for the future She says the report tells a story of progress, empowerment and possibility. 'While challenges remain, mainly due to the cost of living, OMSIM 2025 shows a trajectory of optimism looking into the future. 'The report shows that South Africans are not passively waiting for change, but instead are actively creating it by embracing entrepreneurship, making smarter money decisions and seeking out alternative ways to achieve some level of financial freedom. 'Every year, OMSIM gives us deep insight into how people are coping and adapting when it comes to their finances. This year, more than ever, we see an encouraging collective step forward,' Mabude says.
eNCA
9 hours ago
- eNCA
Study identifies eight policies to alleviate poverty
TSHWANE - In the face of economic hardships, South Africans head to economic hubs like Gauteng in search of greener pastures. WATCH | Poverty crisis in SA's economy Poverty is also high in the in province. A new study has identified eight policies that can help the country's economic hub reduce poverty.
The Citizen
13 hours ago
- The Citizen
Weekly economic wrap: all about the tariffs
The week had good and bad news for South Africans with a 25 basis point cut in the repo rate but a US tariff of 30%. It was a busy economic week, but everybody agrees that everything else was overshadowed by the latest US tariff announcement from the White House, which slapped a 30% tariff on South Africa that will apply from 7 August. Tracey-Lee Solomon, an economist at the Bureau for Economic Research (BER), says the unanimous decision of the Monetary Policy Committee (MPC) of the South African Reserve Bank (Sarb) to cut the repo rate by 25 basis points to 7%, bringing the prime rate to 10.5%, was also important. Then the White House announced its sweeping new trade policy in the early hours of Friday morning, with a tariff of 30% for South Africa. This had an immediate effect on commodity prices and the rand. Solomon says Brent crude traded above $73 a barrel after President Donald Trump threatened to impose tariffs on Indian exports and penalties for its Russian oil purchases, she says. 'Trump also warned of tariffs on Moscow unless a swift truce in Ukraine is reached, potentially triggering secondary sanctions on buyers of Russian crude. This move would likely result in more demand for non-Russian crude, lifting prices.' 'The rand weakened by 2.8% against the US dollar, weighed down by broad dollar strength and South Africa's failure to secure a more favourable trade deal with the US, which likely added to negative sentiment.' ALSO READ: US tariff of 30%: Rand weakest in 3 months, thousands of jobs in danger US Fed, in middle of US tariff chaos, did not change repo rate Bianca Botes, director at Citadel Global, says at the centre of the chaos stood the US Federal Reserve, which held rates unchanged at 4.25% to 4.5%. 'The South African Reserve Bank (Sarb) delivered a 25 basis point cut. This was not a bold or symbolic move by the Sarb; just necessary.' She also noted that gold prices consolidated near $3,292/ounce, ending the week 2% softer after the stellar dollar run although support persisted for gold as a defensive asset, despite the selloff this week, as central banks and safe haven seekers continue to find security in its glimmer. 'Brent crude remained above $71/barrel, supported by anticipation of new trade agreements and supply constraints, including tightening conditions in the diesel market. Risks from potential new tariffs and weak consumer data in some major economies capped stronger gains.' Busisiwe Nkonki and Isaac Matshego, economists at the Nedbank Group Economic Unit, also believe the rand came under renewed pressure after the US tariff announcement that he would impose a further 10% import tariff on the Brics countries and any other economy aligned with the grouping. ALSO READ: Repo rate cut not a surprise but very welcome Reserve Bank lowers repo rate to 7% as expected Damian Maart, an economist at the BER, says, as expected, the MPC decided to lower the repo rate by 25 basis points in a unanimous decision that brings the repo rate to 7% and the prime rate to 10.5%. 'A key takeaway from the MPC press conference was the announcement that future MPC decisions would be anchored around the lower bound of the 3-6% target band. Sarb governor Lesetja Kganyago noted that this was not an official change in the target, as it would mandate approval from the National Treasury. 'June consumer inflation was in line with the preferred rate, but the Sarb expects inflation to pick up over the next few months. Looking ahead, the Sarb's Quarterly Projection Model based on the newly adopted 3% target suggests five more cuts over the medium term, although the MPC is not beholden to the 3% inflation target. Nkonki and Matshego say ultimately the interest rate path will depend on how quickly the Sarb can calibrate inflation expectations and price setting throughout the economy around the lower target. Mamello Matikinca-Ngwenya, Siphamandla Mkhwanazi, Thanda Sithole, and Koketso Mano, economists at FNB, say the MPC statement had few surprises. 'This repo rate cut highlighted the MPC's ability to focus on local dynamics given the limited impact of global volatility on the rand and, by extension, monetary policy.' ALSO READ: Good news for GDP: Manufacturing PMI reaches above 50 points, but employment levels still weak Producer price picked up in June According to Statistics SA, the producer price index (PPI) increased by 0.6% in June, up from 0.1% in May. The uptick was primarily driven by higher producer prices for food, beverages, and tobacco products, which increased by 4% and contributed 1.2 percentage points to overall producer inflation. In contrast, prices for coke, petroleum, chemical, rubber and plastic products declined by 4.7%, subtracting 1%. On a monthly basis, PPI rose by 0.2% in June. Nkonki and Matshego say the PPI outcome was slightly lower than their forecast of 0.8% but aligned with the market's expectations. 'The main driver of the rise was the 'food, beverages and tobacco products category, which rose by 4% with upward pressure coming from meat prices. Elsewhere, price pressures remained relatively subdued or fell further.' Matikinca-Ngwenya, Mkhwanazi, Sithole and Mano say they expect producer inflation to gradually rise in the second half of 2025 but remain benign, averaging around 1.2% this year.
