The Solidarity Research Institute (SRI) in collaboration with ETM Analytics released the fourth edition of the South African Labour Market Report and Index for 2017 today.
“The Labour Market Index (LMI) continued its rise in the third quarter of 2017, but remained below 50. The LMI is a quarterly measure of job and wage security in the South African labour market. The index increased to 47.5 in Q3 from an upwardly revised 47.0 in Q2. A score below 50, the index’s neutral level, indicates declining job and wage security,” said Gerhard van Onselen, economics researcher at the Solidarity Research Institute.
While the index saw its sixth straight quarter of improvement, itis yet to break the 50-point neutral level, Van Onselen added.
“Presently, the LMI is indicating that a downtrend in force from 2011 to the end of 2016 may have been broken. However, the fact that the index is stubbornly persisting below 50 is a telling indication of the structural impediments present in the economy. While there are improvements in some measures of business activity, to the narrow advantage of some sectors, we are running the risk that this present cyclical upswing may go unnoticed by many economic participants. This view is supported by important employment surveys that saw deterioration in Q3 2017,” Van Onselen said.
“Measurements of labour affordability are especially concerning. These measures point to companies experiencing difficulty in affording to hire new staff. Moreover, with employment growth very weak and high unemployment persisting, the employment picture remains gloomy. Lingering job insecurity, retrenchments in some sectors and limited wage gains are likely to remain part of the South African employment landscape for some time to come,” Van Onselen added.
“It is evident that structural problems are beleaguering the economy. Arguably, more should have been made from the narrow and off-shore driven economic recovery in force at present. Political uncertainty, corrosive government policies and rising uncertainty about property rights are hampering capital investment, which is exactly what is needed to improve productivity, wages and employment,” Van Onselen concluded.
The LMI for Q3 is released in collaboration with ETM Analytics and forms part of the South African Labour Market Report. In the October – December 2017 edition of the report:
- Selected Labour Market Statistics
- Solidarity – ETM Labour Market Index Q3 2017
- Private property is good for the economy
- Labour inspections – get your farmhouse in order
- Custodianship: The magic word to make your property rights disappear
- ETM Feature: Capital and labour are anything but enemies
- Macro-economy: South African employment conditions worsening
To download the Labour Market Report and Index, click here.