The latest Quarterly Labour Force Survey (QLFS) update from Statistics South Africa showed a reversal of job gains in the first quarter of 2024 which saw employment falling by 0.6% or 92,416 jobs q/q at 16,652 persons in Q2 of 2024. This is, however, 1.9% or 306,140 people higher relative to the same period in 2023 with the year-to-June 2024 growth of 2.6% on the 2023 levels for the same period.
After surprising on the upside by posting a strong quarterly growth of 2.3% q/q and 6.1% y/y in Q1 of 2024, the primary agriculture sector saw a sharp downturn in the number of jobs by 4.8% q/q at 896,925 individuals in Q2 of 2024. This was however marginally higher by 0.2% or 1,480 persons relative to the same period in 2023 and 97,284 persons above the long-term average of 798,640 persons. Despite the immense challenges the sector had to deal with, it has maintained employment levels way above the long-term average in the past thirteen consecutive quarters or since Q1 of 2021. The two major summer crops, maize and soybeans saw massive reductions in production by 18.8% and 35.8% y/y respectively at 13.33 million and 1.78 million tons.
Other primary agriculture subsectors that recorded declines in employment include livestock and forestry with the former still on the mend following the disruptive disease outbreaks in the past two years while operating in an environment of elevated feed costs.
Provincially, the Western Cape still accounts for the largest share (18.1%) of total primary agriculture employment, but saw numbers dropping by 24.7% q/q and 19.1% y/y. Other provinces which saw big declines include the Northern Cape (-38.9% q/q), Gauteng (-28.5% y/y), and the North West (-27.7% y/y), but the three remain the smaller contributors with shares of 3.7%, 6.3%, and 3.7% respectively of the total country employment for the primary agriculture sector.
These downbeat employment numbers also reflect the mood in the field crop industry with the latest indicator being the agriculture machinery sales which have retained the downtrend since the beginning of the year. Although rebounding by 12% m/m in July 2024, total agriculture machinery sales (tractors and combine harvesters) fell sharply by 17% y/y to 571 units with the total year-to-July 2024 falling by 29% y/y to 3,15 units.
Addressing critical issues such as biosecurity, roads and rail infrastructure, poor municipal services, and ports infrastructure and their efficiencies will go a long way in helping agriculture to unlock further employment opportunities. Nonetheless, all is not doom and gloom as we have recently experienced a sustained electricity supply in the past few months which has reduced operational costs for irrigation, cold storage, and other intensive agriculture operations such as poultry, dairy, and piggeries. Additionally, the weather outlook has turned the corner with La Nina on the way for the 2024/25 summer rainfall season.
By Paul Makube, Senior Agricultural Economist, FNB Commercial
