The Municipal Outreach Project recently published a very thorough report on development indicators for all district and metropolitan municipalities in South Africa. Employment, education, welfare, service delivery, finance, tenure status, and demographics were covered in great detail. It is a unique report that provides a wealth of insights into what is happening in South Africa. One of the many findings is how different the opportunity to ‘work’ is in South Africa depending on where you live.

The definition of who works is somewhat complicated. For this report all people between the ages of 15 and 65 years old were classified as the potential workforce. Employment levels were calculated as the proportion of this population who work in both the formal and informal sectors. The unemployment level was calculated as a reflection of the potential workforce who, want to work, and are looking for work but cannot find any. People who did not look for work, even if they wanted to work, or who were not available for work were not classed as unemployed but as ‘not economically active’.  Readers must be aware that this definition differs from that commonly used in South Africa.

The Ukhahlamba district municipality is in the Eastern Cape. It is headquartered in Barkly East and has a population of approximately 300 000. Only 23% of Africans resident in Ukhahlamba are employed as opposed to 65% of whites. However, only 17% of Africans are unemployed as opposed to just 2.5% of whites. The vast majority of Africans are neither employed nor unemployed; they are simply classified as ‘not economically active’. In other words they do very little other than eking out a rural subsistence existence or waiting for a social grant.  

The Zululand district municipality is in KwaZulu-Natal. Like the Ukhahlamba municipality it is very poor and very rural. It is headquartered in Ulundi and is home to just over 900 000 people. It shows a very similar experience of work to Ukhahlamba. Only 20% of Africans in the Zululand district municipality are employed as opposed to 64% of whites. Then again only 22% of Africans are unemployed as opposed to 1.2% of the admittedly small white population. Over half the African population is simply ‘not economically active’ as opposed to 28% of whites. 

The Johannesburg metropolitan municipality could by comparison be on a different planet. It is the urban and business heart of the African continent and is home to just under 4 000 000 people. Just over 47% of Africans resident in Johannesburg are employed as opposed to 70% of whites. Just over 26% of Africans are unemployed – a higher figure than in the two rural municipalities -   as opposed to 4% of whites. As a result only 22% of Africans are ‘not economically active’ which compares well with the 21% of whites who are 'not economically active'.

The point that comes out quite starkly from this review is how little formal economic activity is going on in deep rural South Africa. That Johannesburg’s unemployment figures are higher than those in Zululand and Ukhahlamba should not be a cause of undue concern as the figures reflect that there is something going on in Johannesburg and the promise of a job. Unemployment levels are higher but so are employment levels. The low unemployment figures for rural South Africa are in many respects misleading.

In chasing employment and unemployment targets we should not ignore that many rural South Africans exist outside of those targets. Bringing them into the targets, even if that were to mean hiking the unemployment rate in the short term, should be a priority for government. This requires making available the opportunity to work. That will in turn require addressing all the usual impediments to growth in South Africa including education, labor market regulation, effective governance, and infrastructure.

-Frans Cronje