The unemployment rate in 2025 continued to fluctuate, rising in one quarter and falling in another. However, the number of unemployed people in the country is still higher than in other countries. Part of the reason unemployment had not improved was that companies that retrenched employees and some that completely closed down.
Changes in consumer behaviour and preferences also led to financial distress. There was a slight difference in the unemployment rate between this year and the previous one. According to Statistics SA’s Quarterly Labour Force Survey,unemployment in the third quarter of 2025 dropped to 31.9%.
Unemployment rate stood at32.1% in the third quarter of 2024. In terms of the numbers, employed people increased by 248 000 to about 17.1 million, while the number of unemployed people decreased by 360 000 to 8 million. Discouraged work-seekers increased by 36 000 and other available potential job seekers increased by 130 000 to 965 000.
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In contrast, the number of unavailable job seekers increased by 64 000 to 83 000, resulting in a net increase of 230 000 to 4.5 million in the potential labour force population. The US tariffs are one of the reasons why it is expected that unemployment will worsen in 2026, as experts believe the third-quarter 2025 unemployment drop is a brief pause before the full impact of the tariffs hits the workforce. Jee-A van der Linde, senior economist at Oxford Economics Africa, says the decline in the unemployment rate is driven by job increases in construction and trade.
However, manufacturing continues to shed jobs. “However, given our view of a delayed impact from US tariffs, the labour market will remain under pressure and may weaken over the coming quarters,” he said. “Looking at employment by industry, manufacturing is the sector most exposed to US import tariffs, which decreased on a quarterly basis. “Meanwhile, recent economic data releases align with our view that the business environment has not yet improved enough for economic growth to pick up meaningfully in the near term.”
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