Once more, SA’s statistics authority sent out shock waves when it released the latest employment data last week. In reporting the numbers, many news outlets and commentators kept repeating how unemployment has reached unprecedented levels.
But it’s important to note that Stats SA has had to adjust its surveying method due to Covid, using only part of the sample because of the limitations around conducting face-to-face engagements.
For this reason, it has warned that "the second quarter of 2021 estimates are not based on a full sample, and comparisons with previous quarters should be made with caution".
Even with that caveat, SA probably has one of the highest unemployment rates in the world. But comparisons may not be the key issue. Instead we have to ask: what is the employment problem we are trying to solve?
For a long time, it has been accepted that it is a growth problem. As long as the economy grows, the problem of unemployment will decline.
However, the recent Stats SA data suggests otherwise. On August 25, it released data following the "overhaul of national accounts and GDP". In its statement, the statistics agency noted that "economies are dynamic, shifting and changing over time. New industries rise to dominance while others fade away, consumer tastes wax and wane, and new technologies replace the old. Rebasing and benchmarking exercises ensure that the tools used to measure the economy take these changes into account."
This important exercise has revealed notable outcomes. As Stats SA says: "The revised GDP at current prices shows that the economy is 11% larger in 2020 than previously estimated." In other words, the economy has grown faster in the decade to 2020 than previously thought.
It is, therefore, much more dynamic.
Now, the manufacturing sector experienced notable growth during the review period. Yet, in terms of employment, manufacturing has consistently shed jobs.
What is this telling us?
The number of unemployed people under 25 years is double the number of those with jobs
This may speak directly to technological advances in the way we produce goods.
I was speaking to an executive in brick manufacturing recently. He told me there isn’t a single person working in the brick manufacturing process in his company’s new plant.
The only time a human being touches the bricks is at the construction site.
It is important to note here that previous research suggests the construction sector has higher job creation multipliers than other sectors. Part of this relates to the manufacturing of inputs, including bricks.
But it seems that mechanised or technology-driven brickmaking is now a detractor to the construction value chain in terms of job creation.
Which means the sectors we have previously relied on to create jobs are changing.
In "Robots Will Put People Out of Work — And Hope", an article on news website New Frame, Prof Tshilidzi Marwala, an authority on robotics, is quoted as saying that robots are more reliable than humans simply because they don’t get sick.
"If the worker is a robot, it doesn’t have to social distance," he says.
If the brickmaking example is anything to go by, people are already being put out of work by technological advances.
Facing the future
Towards the end of last year I facilitated a "future of work" webinar series with the National Economic Development & Labour Council and its social partners, supported by the International Labour Organisation.
The series recognised that "new forces are transforming the world of work, which calls for decisive action in making decent work a reality for Africa’s youth, developing skills, technological pathways and productivity for a brighter future in Africa".
The latest employment numbers tell a clear story in this regard. The number of unemployed youth under 25 years is double the number of those with jobs. If we look at the number of unemployed people under 35, it is the same as those in employment (about 5-million).
The question is, are we ready to change our minds about what the problems are that we face? Are we willing to see that the age of information and technology is changing our lives and we need to respond?
We can’t keep putting off debates about the changing nature of work, and what that means for our future economies.
Payi is an economist and head of research at Nascence Advisory & Research
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