Improvement in job figures not lifting the metals and engineering sector out of crisis

The Steel and Engineering Industries Federation of Southern Africa (Seifsa) has welcomed the 1% increase in employment figures for the third quarter of the year, as reported by Statistics South Africa on Monday, which showed a general injection of 93 000 jobs in the economy.

Seifsa senior economist Tafadzwa Chibanguza noted, however, that net employment had decreased by 6 000 jobs in the nine months to September 30.

“However, given the lacklustre performance of the South African economy in 2016, we need to celebrate all the wins, even the small ones, which contribute to lessening the pressure in the long-run trend,” he said.

He added that it was unfortunate that the manufacturing sector had shed 3 000 jobs between the second and third quarters this year, and 19 000 jobs over the first nine months of the year.

“We view this with concern because the metals and engineering sector constitutes 28% of total manufacturing,” he noted.

Chibanguza further stated that production decreases have been greater than employment decreases and that the metals and engineering sector is likely to experience more cost rationalisation through further job losses.