SA Jobless Rate Rises to 33.2% as Youth, Informal Sector Face Deep Strain

South Africa’s labour market continues to face mounting pressure, with the official unemployment rate climbing to 33.2% in the second quarter of 2025, according to the latest Quarterly Labour Force Survey (QLFS) released by Statistics South Africa (Stats SA). The report highlights both structural weaknesses and emerging challenges in the economy, prompting renewed calls for a paradigm shift in employment policy.

Rising Long-Term Unemployment

The QLFS shows a troubling increase in the number of South Africans unemployed for longer than a year, which rose by 116,000 people, while short-term unemployment also grew by 23,000. These figures underscore the persistence of long-term joblessness, which disproportionately affects young people, women, and low-skilled workers.

Although the expanded unemployment rate (which includes discouraged job seekers) dropped slightly by 0.2 percentage points to 42.9%, the decline was not enough to offset the broader deterioration in job prospects.

Limited Job Creation Amid Economic Headwinds

The second quarter recorded net job gains of just 19,000, despite the labour force expanding by 0.6%. Job creation lagged far behind unemployment growth, which surged by 140,000.

• Sectors with job gains:

  • Trade (+88,000)

  • Private households (+28,000)

  • Construction (+20,000)

• Sectors with job losses:

  • Community services (-42,000)

  • Agriculture (-24,000)

  • Finance (-24,000)

  • Transport (-15,000)

  • Utilities (-6,000)

  • Manufacturing (-5,000)

Provincial data painted a mixed picture. The Eastern Cape recorded the highest employment growth at 6.5%, followed by Mpumalanga at 0.9%, while the Northern Cape (-8.3%), Western Cape (-4.1%), and KwaZulu-Natal (-3.1%) saw steep declines.

Informal Sector and Data Gaps

A critical issue highlighted by the department is the size and role of the informal sector. Official data shows that only 16 in every 100 workers are in informal employment, compared to around 45% in other middle-income countries such as Mexico, Nigeria, and Uganda.

The Department of Employment and Labour commended Stats SA for reviewing survey methodologies, particularly for measuring informal work. The department noted that underreporting may mask the true extent of informality, limiting the country’s ability to support this critical source of livelihoods.

“This commitment is timely and necessary, enriching the national discourse and highlighting the urgent need for modernised tools and approaches that reflect the realities faced by South Africa and other emerging markets,” the department said.

Inequalities Persist

The survey also revealed widening inequalities in employment, with race, age, gender, location, and education continuing to shape job opportunities. Young people aged 15–34 years remain the most vulnerable group, a trend the department warned could worsen with projected GDP growth of just 0.9% for 2025 and the impact of US tariffs on export-driven industries.

Call for a Paradigm Shift

In response, the department stressed the need for new approaches to unemployment, particularly youth unemployment.

“This requires expanding viable livelihood pathways within the informal economy, tackling structural constraints that limit its potential as a site of dignified work and entrepreneurship, and enhancing policy design through richer data on informal sector realities.”

The department also pledged to support:

• Skills development aligned with labour market demand.

• Transformation of labour market systems for greater inclusivity.

• National dialogue to drive collective solutions.

Looking Ahead

Stats SA will publish the third-quarter QLFS in November 2025, incorporating new standards from the International Conference of Labour Statisticians, which are expected to yield a clearer picture of South Africa’s labour dynamics.

The Department of Employment and Labour has urged stakeholders, including policymakers, employers, and labour organisations, to engage with the revised data and contribute to shaping policies that promote resilience, inclusion, and sustainable job creation.