By: ThinkBusiness Africa
South Africa’s official unemployment rate fell for the second consecutive quarter, dropping to 31.4% in the final three months of 2025. While the figure marks the lowest level since the 2020 COVID-19 shock, the latest data from Statistics South Africa (Stats SA) reveals a labor market still struggling with deep structural fractures.
According to the Quarterly Labour Force Survey (QLFS) released on Tuesday, the number of employed persons saw a modest increase of 44,000, reaching a total of 17.1 million. Simultaneously, the number of unemployed individuals decreased by 172,000, settling at 7.8 million.
The Formal Sector emerged as the primary driver of growth, adding 320,000 jobs. This was led by gains in Community and Social Services (+46,000), Construction (+35,000), and Finance (+32,000).
Meanwhile, the Informal Sector suffered a sharp contraction, shedding 293,000 positions. Analysts suggest that while formal industries are stabilizing, the “survivalist” economy of the informal sector is failing to provide a reliable safety net for those unable to find traditional work.
Economists have cautioned against over-optimism regarding the 0.5% drop. A closer look at the data shows that much of the decline in the official rate is due to people exiting the labor force entirely rather than finding work.
The Expanded Unemployment Rate—which includes those who have stopped looking for work—remains at a staggering 42.1%.
The youth (ages 15–34) continue to bear the brunt of the crisis. Despite the overall improvement, youth unemployment edged up slightly to 43.8%, as the economy failed to absorb first-time job seekers entering the market at the end of the school year.
As South Africa moves into 2026, the government faces mounting pressure to translate these marginal “statistical gains” into tangible opportunities for the nearly 8 million people still without work.
