The Quarterly Labour Force Survey for the first quarter of 2026, released yesterday by Stats SA, points to an unemployment rate now standing at 32,7%.
Frank Blackmore, lead economist at KPMG, points out that employment, like GDP, tends to fluctuate seasonally, so some variation can be expected from quarter to quarter.
“However, there was a significant decrease in employment when comparing the fourth quarter of 2025 to the first quarter of 2026,” he says. “This echoes the pressures that both consumers and businesses face: rising costs, high inflation, elevated interest rates, and, fundamentally, insufficient economic growth.”
The study shows that year on year, nearly half a million people joined the working-age population (those aged 15 to 64). Over the same period, 33 000 jobs were lost.
While the number of unemployed individuals decreased by 91 000, Blackmore points out, this was largely due to a significant increase in the number of people outside the labour force, which grew by 622 000.
“If we look at the sector breakdown of the figures on a quarter-on-quarter basis, agriculture, so your primary sectors, agriculture and mining, showed an increase in employment,” he says.
“At the same time, manufacturing also showed an increase in employment on a quarter-on-quarter basis, with the other seven sectors – in other words, utilities or electricity, water, etcetera, showing a decrease in construction, a reduction in employment, trade, transport, finance, and community and social services all showing a reduction in employment over this period of time.
On a year-over-year basis, if we compare the first quarter of 2026 to the first quarter of 2025, we see a slightly different story: manufacturing actually lost jobs, agriculture and mining both added jobs, and utilities also lost 32 000 jobs. There were also reductions in employment in the transport industry, finance, and community and social services over this period.”
On a provincial basis, the province with the highest unemployment rate remains the Eastern Cape at 44,6%; behind it are the Free State at 37,8% and Mpumalanga at 36,3%, while the best-performing province is still the Western Cape at only 19,6%. “Although its unemployment rate has also increased by 1,5% from the fourth quarter of last year,” Blackmore points out.
“The underlying message here is that both consumers and businesses are facing increased costs; there’s less money to spend out in the economy, and economic growth is just not enough to absorb all those people entering the labour force.
“We need to increase that growth, and to do so, we need to attract international investment and invest more ourselves, which will require, you know, a lot of different initiatives based on the policy space and attracting investment space, for us to get the type of growth rates we need to dent this unemployment seriously.
Tando Ngibe, senior manager at Budget Insurance, says the latest data paints a concerning picture of a labour market under severe pressure. With 345 000 fewer South Africans employed, total employment is down to 16,8-million.
“The reality of these statistics means that more households are now navigating the uncertainty of lost income, rising living costs, and the ongoing challenge of making ends meet.
“Equally concerning is the growing number of discouraged work-seekers, which increased by 178 000 to 3,9-million.
“For many South Africans, these are more than just statistics,” Ngibe says. “Behind these numbers are families facing difficult financial decisions every day — whether it is putting food on the table, paying for transport to work or school, keeping up with debt repayments, or covering basic household expenses.
“These figures come at a particularly difficult time, following recent increases in food prices and fuel costs, both of which continue to place additional strain on already stretched household budgets.
“South Africans are encouraged to focus on protecting their financial well-being by actively budgeting, paying down debt with high interest and prioritising essential expenses as a means to find practical ways to build financial resilience,” Ngibe adds. “While this may be tough when faced with rising costs, even the smallest changes can make a massive difference.”