South African employers are reporting mild hiring plans for the first quarter of 2014 in the Manpower Employment Outlook Survey.
Nationally, employers expect moderate opportunities for job seekers this quarter as South Africa’s seasonally adjusted Net Employment Outlook stands at +4%. Despite the outlook staying relatively stable quarter-on-quarter, it is five percentage points stronger year-on-year.
Lyndy van Barselaar, MD of Manpower SA provides insights into why the South African employment market remains reserved, “While rising activity levels in the mining & quarrying, agriculture and service sectors should assist in reaching the expected average annual growth rate, South Africa still faces several challenges.
“The country’s business interests continue to be negatively affected by global trading conditions, with adverse local factors aggravating its performance in recent times. Recessionary conditions in South Africa’s main trading partner, the Eurozone, also have an effect on South African industries, especially in terms of exports and creating jobs in the private-sector.”
“Combined with subdued growth elsewhere in the world, such developments are impacting the prospects for job seekers in the New Year.”
Employers in four of the five regions foresee payroll gains in the first quarter. A cautiously optimistic Net Employment Outlook of +7% is reported for the Eastern Cape, while the Western Cape reports an encouraging outlook of +10%. Modest hiring opportunities are expected in Gauteng and KwaZulu-Natal, where the outlook stands at +3%. The Free State expects stagnant hiring prospects, with an outlook of -2%.
“A commitment from provincial governments in the country’s drive to overcome the shortage of suitable, skilled labour is a factor that continues to contribute to the expected positive hiring pace. Government is supporting skills development through giving incentives to companies that train certain employees through accredited training like CETA, for example,” says Van den Barselaar.
Quarter-over-quarter, hiring plans weaken in four of the five regions. However, employers report improvements of one percentage point in the Western Cape.
Hiring prospects improve in four of the five regions when compared with Q1 2013. The most noteworthy improvements of nine percentage points are reported in the Western Cape and Eastern Cape. Employers in Gauteng report an Outlook increase of 4 percentage points and hiring plans are 1 percentage point stronger in KwaZulu-Natal. However, hiring intentions weaken by 3 percentage points in Free State.
Employers in eight of the 10 industry sectors anticipate growing payrolls during the first quarter. The most positive hiring intentions are reported in the Electricity, Gas & Water Supply sector and the Mining & Quarrying sector, where Outlooks stand at 12% and 11%, respectively.
“With the Mining industry looking into new, specialised forms of mining such as fracking and off-shore mining, a demand is being created for those with specialised skills. Additionally, the Chamber of Mines plans to create 20 000 mining jobs by 2020, which continues to play a part in the anticipated growth of the Mining & Quarrying sector into the first quarter of 2014,” says Van den Barselaar.
Quarter-over-quarter, hiring prospects strengthen in five of the 10 industry sectors. The Electricity, Gas & Water Supply, Mining & Quarrying and Wholesale & Retail Trade sectors all report slight increases in hiring intentions, while hiring intentions in the Construction, Public & Social and Transport, Storage & Communication sectors remain relatively stable.
“Employers in the Electricity, Gas & Water Supply sector report the strongest hiring intentions for Q1 of 2014. This is possibly owing to Government’s increased efforts to supply those in rural areas with basic housing, electricity and access to clean water. Additionally, the industry is also heading towards more sustainable use of energy and resources. This creates a demand for employment of those job seekers with skills in areas such as the implementation of renewable energy and that of new technologies in water reuse and recycling, for example,” says Van den Barselaar.
Employers report stronger hiring intentions, compared to the same quarter in 2013, in eight of the 10 industry sectors. The strongest improvement is in the Restaurants & Hotels sector where the Outlook strengthens 11 percentage points. Meanwhile, the forecast in the Manufacturing sector improves 10 percentage points.
A flat labour market is forecast for Q1 2014 in the Public & Social sector, where employers report a slight decrease in hiring intentions when compared with the previous quarter.
“It is important for government to continue upskilling and empowering the public sector, as well as to continue to provide support for small-, medium- and macro-enterprises. This will ensure that hiring prospects for the Public & Social sector will improve in 2014,” says Van den Barselaar.
The Agriculture, Hunting, Forestry & Fishing sector reports conservative employment opportunities in the first quarter of 2014. While the Outlook for the sector experienced
a considerable decrease quarter-on-quarter, it remained relatively stable year-on-year.
“It is expected that the employment outlook for job seekers will remain relatively encouraging entering 2014, with positive hiring intentions reported in most sectors and regions. The South African GDP is expected to increase marginally to 2,8% in 2014, according to a report by Chief Economists at FNB,” Van den Barselaar says.