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Agriculture sector in South Africa lost 37,000 jobs

Staff writer |
South Africa's agriculture sector is losing jobs as the country feels the effects of the worst drought in 25 years. Statistics SA said that agriculture shed 37,000 jobs.

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Job losses in agriculture are likely to continue in the first quarter of this year given that the production of summer crops, such as maize, is expected to be less than last year, Grain SA economist Wandile Sihlobo said.

"Financial strain is also one of the factors weighing on the sector. So continued financial intervention and assistance to distressed farmers will really help, especially looking ahead to the next planting season."

The drought is wreaking havoc: food shortages and quick increases in food prices. With food inflation rising, headline inflation will follow, thus encouraging more interest rate hikes by the Reserve Bank. The Treasury announced this week that R1bn would be directed to drought relief. This in on top of other loans the government has instructed the Land Bank to offer to farmers in distress.

The unemployment rate fell from 25.5% to 24.5%, the survey showed, as the services sectors such as trade added jobs associated with the busy festive period.

The expanded unemployment rate, which takes into account people who are able to work but are not actively looking, fell slightly to 33.8% from 34.4% previously.

The unemployment rate means 5.2-million people are unemployed versus 5.4-million in the third quarter.

The number of unemployed was 5.8% higher compared with the last quarter of 2014 and the number of discouraged work seekers increased over the quarter, showing that weak economic activity and business confidence had had a negative effect on the labour market, Nedbank economist Johannes Khosa said.


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