South Africa’s Unemployment Rate Rises to 33.2% in Q2 Amid Economic Challenges

South Africa’s Unemployment Rate Rises to 33.2% in Q2 Amid Economic Challenges

South Africa’s unemployment situation has worsened in the second quarter of the year, with the official unemployment rate increasing from 32.9% in Q1 to 33.2%, according to Statistics South Africa (Stats SA). This marks a continued struggle for the country’s labor market as more people find themselves out of work.

While the expanded unemployment rate—which also accounts for discouraged job seekers who have stopped looking for work—showed a slight improvement, decreasing by 0.2 percentage points to 42.9%, the overall labor market remains under severe pressure.

Sectoral Employment Shifts

Stats SA reports that employment rose in the formal sector during this period, with notable job gains in trade, private households, and construction. Conversely, the informal sector experienced job losses, reflecting a mixed picture of economic activity.

Other sectors, such as government services, agriculture, finance, transport, utilities, and manufacturing, saw declines in employment. These shifts highlight structural challenges in various parts of the economy.

Disproportionate Impact on Women, Particularly Black African Females

The unemployment crisis is not uniform across demographics. Black African females continue to be the worst affected, with unemployment rates significantly higher among women compared to men. Risenga Maluleke, Statistician General at Stats SA, emphasized that the unemployment rate for Black African women on the expanded definition stands at a staggering 51%, underscoring persistent inequalities.

“You see that on the narrow formal definition it sits at 40.2%, which is about seven percentage points higher than the overall unemployment rate of 33.2%,” Maluleke explained.

Youth Unemployment Remains Alarmingly High

Young people between the ages of 15 and 34 remain particularly vulnerable in the labor market. The number of unemployed youth rose by 39,000 to 4.9 million in Q2, pushing the youth unemployment rate to 46.1%.

Economic Outlook: Hope Amid Challenges

Experts point to a struggling economy as the root cause of high unemployment. Johann Els, Chief Economist at Old Mutual, indicated that despite current challenges, there are signs of cautious optimism.

“Low inflation and lower interest rates are supporting consumer spending, particularly in the trade sector where retailers are employing more people,” Els said. “These green shoots should help foster better economic growth going forward.”

However, Els cautioned that structural constraints remain a hurdle that must be addressed for sustained job creation.

Summary

South Africa faces a tough labor market with rising unemployment in Q2 2025, especially affecting women and youth. While some sectors show job gains supported by favorable economic conditions like low inflation, significant structural challenges continue to impede overall employment growth. Addressing these issues will be critical to improving the country’s economic outlook and reducing unemployment.