South Africa’s labour market experienced a sharp contraction in the second quarter of 2025, shedding approximately 153,000 jobs, according to the Quarterly Labour Force Survey (QLFS) P0211.
The official unemployment rate rose to 33.2%, up from 32.9% in Q1, while the expanded unemployment rate which includes discouraged work-seekers climbed to 42.1%.
Key sectors such as construction (-56,000 jobs), manufacturing (-41,000), and trade (-32,000) were the hardest hit, while finance (+12,000) and agriculture (+9,000) posted modest gains.
“The second quarter of 2025 saw notable declines in employment across formal and informal sectors, with youth unemployment remaining critically high at 61.9%,” the report states. “Provincial disparities were evident, with Gauteng and Western Cape accounting for over half of the net job losses.”
The report highlights a 1.5% increase in discouraged work-seekers, now totaling 3.6 million, and a drop of 27,000 jobs in the informal sector, reversing gains from Q1.
These figures underscore the fragility of South Africa’s labour market amid tightening economic conditions and delayed infrastructure rollout.
“The decline in construction employment reflects reduced public sector investment and project delays,” the report notes. “Manufacturing job losses were driven by lower export demand and rising input costs.”
The broader implications are significant. As one of Africa’s largest economies, South Africa’s labour trends influence regional migration, remittance flows, and investor sentiment.
International analysts warn that sustained weakness could dampen appetite for emerging market assets.
“Labour market instability poses risks to social cohesion and economic recovery,” the report concludes. “Urgent policy responses are needed to stimulate job creation and protect vulnerable sectors.”
Despite the downturn, the report identifies pockets of resilience. Seasonal hiring in agriculture and increased demand for financial services in rural areas contributed to modest employment gains. However, these are insufficient to offset broader structural challenges.
The upcoming Medium-Term Budget Policy Statement (MTBPS) will be pivotal. Stakeholders are calling for targeted fiscal stimulus, skills development, and accelerated infrastructure investment to reverse the trend.
By Eric Kasongo
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