South African unemployment rate drops to two-year low

The official unemployment rate in South Africa dropped for the fourth consecutive quarter in October-December, according to a national statistics report on Tuesday. 

Data showed the jobless rate slid to 32.7% in the final three months of 2022 from 32.9% in the July-September period. The figure is the lowest since the first quarter of 2021.

The improvement was mainly driven by the finance sector, particularly among labor brokers and the security industry, Bloomberg cited the chief director of labor statistics, Desiree Manamela, as saying. That boost was reportedly followed by private households and the trade industry.

The total number of unemployed, however, rose to 7.753 million people in October-December from 7.725 million in the previous three months.

According to an expanded definition of unemployment that includes those discouraged from seeking a job, 42.6% were without work in the fourth quarter compared with 43.1% in the third.

The continent’s most industrialized economy, South Africa has one of the highest unemployment rates in the world, which had exceeded 20% for at least two decades. The rate hit a record high of 35.3% in the fourth quarter of 2021.

South Africa has been suffering from an energy crisis, with intense blackouts hurting businesses and economic activity. The country’s largest producer of electricity, Eskom, has been slashing production as more than half of its capacity is unavailable due to frequent breakdowns at its ageing power stations. Eskom previously stated that the country needs an additional 4,000 to 6,000 megawatts of generating capacity to eliminate the supply-demand gap.

The South African Reserve Bank recently said blackouts cost the country about 899 million rand (almost $50 million) per day.

For more stories on economy & finance visit RT's business section