The country's unemployment rate has increased, Statistics South Africa (Stats SA) said on Thursday.

According to the Pretoria-based agency, South Africa's official jobless rate stood at 24,5% for the third quarter of 2009 compared to 23,6% in the second quarter of the year.

Employment contracted by 3,6% or 484 000 jobs in the third quarter, Stats SA said.

Most job losses were observed in the manufacturing sector (down by 8% or 150 000 jobs) and the wholesale and retail trade sectors (down by 3,7% or 110 000 jobs), the agency said.

Of the 484 000 jobs lost, 283 000 were in the formal sector excluding agriculture, 116 000 in the informal sector, 57 000 in agriculture and 28 000 in private households.

Stats SA said the fall in the employment rate was accompanied by an increase in unemployment (up by 67 000 people) and another increase of 510 000 people amongst the not economically active.

The discouraged work-seekers accounted for 115 000 of the increase in the not economically active sector, Stats SA said.

"These patterns suggest that there was a shift from employment into unemployment, discouragement and inactivity.

"They show the continued deterioration in the South African
labour market resulting from the decline in employment for the third consecutive quarter," Stats SA said.

The employment constraints in the labour market were reflected in a fall in the absorption rate by 1,7 percentage points to 41,3% and another fall in the labour force participation rate by 1,5 percentage points to 54,8%, the agency said.

Turning to year-on-year changes in the third quarter, Stats
SA said a contraction of employment of 770 000 was indicated -largely on account of a fall in non-agricultural formal sector jobs by 366 000.

In his Medium Term Policy Budget Statement earlier this week,
Finance Minister Pravin Gordhan said the creation of jobs -particularly amongst a relatively unskilled population - was the country's greatest economic challenge.

He warned that if a resolution was not found for the problem, there would be catastrophic implications for social stability and future growth.