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South African employment prospects remain weak

11th December 2012

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South African job prospects are set to remain downbeat in the first three months of 2013, with employers reporting one of their weakest first-quarter forecasts on record.

This is according to the Manpower Group’s latest Employment Outlook Survey, which found that 9% of employers expected to increase staffing levels, while 8% expected a decrease and 82% forecast no change, leaving the seasonally adjusted net employment outlook at -1%.

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Manpower Group South Africa MD Lyndy van den Barselaar said the recent mining and transport strikes had weakened business and investor confidence in South Africa, which would translate into less capital in the system, less business growth and, ultimately, fewer employment opportunities.

“Mass layoffs have increased unemployment figures and may possibly lead to the long-term goals of mines brinh to find automated solutions. Other mines have acclimatised to finding workarounds for striking or laid-off workers and are adapting to smaller workforces,” she stated.

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Van den Barselaar said employers were also factoring in rises in energy and fuel prices into their employment plans in light of higher oil prices and Eskom’s plans to increase electricity charges by 16% a year over the next five years.

Many employers were also adopting a wait-and-see approach in relation to the results of the African National Congress leadership election in Manguang in preparation for national elections in 2014.

According to the research, job seekers in the transport, storage and communication sector should find the most opportunities in the quarter ahead, with a net employment outlook of +5%.

Some job gains are also anticipated in the public and social sector and the agriculture, hunting, forestry and fishing sector, with outlooks of +4% and +3% respectively.

“The consumer is driving employment in many of these industries and companies seem be playing a waiting game, assessing the currently low consumer sentiment and spending, before embarking on any decisive employment strategies,” Van den Barselaar said.

Employers in five sectors anticipated negative headcount growth, most notably the construction sector, where the outlook stands at -10%; the electricity, gas and water supply sector, where employers report an outlook of -4% and the manufacturing sector outlook, which is -3%.

“The construction sector expects to see continued slowdown in growth as businesses become more frugal on spending owing to lower consumer confidence and, as the manufacturing sector continues to be hit by less demand from import partners such as Europe,” Van den Baselaar said.

Meanwhile, slow-paced hiring activity was expected in both KwaZulu-Natal and the Western Cape, with net employment outlooks of +2%.

Elsewhere, job seekers in the Eastern Cape were likely to face a muted hiring pace, with employers reporting an outlook of -3%, while employers in Gauteng and the Free State report uncertain hiring plans with outlooks of 0% and -1% respectively.

“The first quarter of 2013 is not predicating any large-scale upswings for employment; however, some positive factors may indicate that employment will start picking up through the year.  With favourable outcomes from Mangaung and the holiday season, we may see a more positive outlook for the second quarter of the year,” Van den Barselaar concluded.

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