More residents are in employment as Cape Town’s unemployment rate drops

2 August 2018

Today, I am pleased to reflect on the city’s encouraging economic results which shows that employment increased by 74 000 in the second quarter of 2018 compared to the same time last year. In addition, Cape Town’s official unemployment rate of 21,3% is much lower than the national unemployment rate of 27,2%.

This is the eighth consecutive quarter in which the city has shown positive employment growth.

In fact, when considering the expanded unemployment rate, Cape Town’s rate, at 22,6%, is far below the national expanded unemployment rate of 37,2%.

The recent Quarterly Labour Force Survey 2018 for the second quarter, from 1 April to 30 June 2018, shows that Cape Town has the lowest expanded unemployment rate of all metros in the country.

Cape Town’s growing employment is a testament to the City’s efforts to create an enabling environment for businesses to invest and to create new jobs – despite many challenges, including the drought and the crippling Metrorail service interruptions.

The City’s expanded unemployment rate decreased by 1.2 percentage points from the previous quarter and is 1.6 percentage points lower than the same period last year between April and June.

Statistics South Africa’s figures show the number of unemployed people in Cape Town has decreased on a quarter-on-quarter basis by 26 000.

What is even more encouraging is that formal employment, which represents the bulk of employment in Cape Town, has increased on both a quarter-to-quarter and year-on-year basis. At present 1.29 million people are in formal employment in Cape Town and 184 000 are employed by the informal sector.

However, we cannot rest for one minute as there are still 434 000 residents who are of working age but have not found employment yet; and there are another 14 000 residents who have given up looking for employment. Cape Town competes with cities around the globe and we know the world owes us nothing.

The City is therefore focussed on creating an environment conducive for businesses to grow, create jobs, and for the city to attract more local and foreign direct investment. The City’s own Department of Investment and Enterprise is supporting those sectors which are showing the most growth and have potential to create jobs by assisting with skills training and other interventions.

Through the City’s funding to Wesgro and other industry bodies through our special purpose vehicles, we are working closely with the private sector to promote trade and grow a more inclusive economy. Between April and June these efforts attracted R1,3 billion in investments. In addition, 912 residents were trained in scarce skills, and over 1 200 new direct jobs are being created.

This week, a study by Endeavor Insight of Africa’s technology industry found that Cape Town’s technology sector employs more people than Lagos and Nairobi combined. Despite the city only having some 550 tech firms based here compared to the up to 900 in Lagos and Nairobi, Cape Town employs up to 50 000 people in the sector, while Lagos employs up to 14 000 and Nairobi employs close to 9 000.

Last month, the City hosted a two-day summit with all players working in the film, advertising, animation and gaming industry to see how the sector can attract more investment and transform its current operating model to be more inclusive.

I was pleased to see how positive the whole sector is about working together to recover after experiencing a very difficult year. This sector employs thousands of Capetonians and the City is committed to working with the industry to ensure continued growth.

We introduced no tariff increases for the film industry in the 2018 /19 financial year and the City is committed to looking at all possibilities including a zero-based tariff for the next two seasons to ensure our film industry recovers and continues to create jobs. The City is also determined to unlock more locations for the film industry to use and thereby improve the industry’s offering to attract international investment.

The City and the majority of the industry signed a pledge that commits all parties to growing the industry in an inclusive manner.

We will continue working hard in our efforts to bring more investment and create more jobs in Cape Town so that we can address poverty and unemployment and put a greater dent into the number of people who are still without work.

Issued by Zara Nicholson, Spokesperson for the Executive Mayor, Patricia de Lille, City of Cape, 2 August 2018