South African jobless rate climbs to 25.5% as economy slumps

South Africa’s unemployment rate increased to 25.5 percent in the third quarter amid a slowdown in the economy fueled by power shortages and falling commodity prices.

The number of people out of work increased by 188,000 to 5.4 million, the statistics agency said in a report released on Tuesday in the capital, Pretoria. The median estimate of 10 economists surveyed by Bloomberg was for the unemployment rate to remain little changed at 25.1 percent.

Africa’s second-largest economy is struggling to create enough jobs at the same time that sliding commodity prices force mining companies such as Anglo American Platinum Ltd. to consider firing workers. Finance Minister Nhlanhla Nene last week lowered his growth forecast for this year to 1.5 percent from 2 percent.

A women pushes a wheel barrow transporting water as she walks past the Anglo American Platinum's Thembelani mine near the mining town of Rustenburg, northwest of Johannesburg, South Africa October 5, 2015. Members of South Africa's Association of Mineworkers and Construction Union will decide on whether to strike at operations of gold companies at a mass meeting on Sunday, a spokesman said on Monday. "We have a certificate to strike at each company, we want to allow our members to decide," Manzini Zungu said. REUTERS/Siphiwe Sibeko
A women pushes a wheel barrow transporting water as she walks past the Anglo American Platinum’s Thembelani mine near the mining town of Rustenburg, northwest of Johannesburg, South Africa October 5, 2015. REUTERS/Siphiwe Sibeko

Manufacturing, which makes up about 13 percent of the economy, added 18,000 jobs, while employment in mining was unchanged, the statistics office said. Unemployment increased despite the rise in employment in most industries since more job-seekers entered the market, according to the agency.

“We had a lot of people who were not economically active who went into the labour force and started looking for jobs, that’s why the unemployment rate went up,” Dihlolelo Phoshoko, acting executive manager of labor statistics, told reporters in Pretoria.

The unemployment rate is compiled from a household survey covering the formal and informal industries.

– Bloomberg [Amogelang Mbatha and Tshepiso Mokhema]