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How Confident Are SA’s Employers About Job Prospects?

Author: Megan Ellis
Date: 2017-05-30
Employment is a key concern for many South Africans. But how are confident are employers about job prospects at their companies?
The latest Employment Outlook Survey conducted by ManpowerGroup shows some revealing insights about employer confidence in South Africa. The survey was conducted during the first quarter of 2017. ManpowerGroup interviewed a representative sample of 750 South African employers to find out how positive they are about the potential to expand their workforces. So what did the results show?

Employers Are Cautiously Optimistic

The survey found that employers were "cautiously optimistic" about hiring prospects in Q1. According to the results, 13% employers expected an increase in staff numbers. Meanwhile, 5% expected a decrease and 80% expected no change in numbers. The survey measures "Net Employment Outlook" - the expected increase, minus the expected decrease. It also presents figures adjusted for seasonal variation. The latest results measured a Net Employment Outlook of 7% overall (adjusted for seasonal variation). This is a slightly better outlook than the one employers had at the beginning of 2016. But there has been a slight decrease since the end of 2016. It is expected that this outlook may have changed once the news of President Jacob Zuma's cabinet reshuffle hit headlines. It is likely that with the economic uncertainty resulting from junk status, employers might not have as cheery prospects as before. But the economy is not the only factor at play in employer confidence. Location and industry also weighed in on their outlook, if the survey results are anything to go by. So what did these figures reveal?
Read More about what junk status means for car owners below

Western Cape Employers Are The Most Positive

It seems that employers located in the Western Cape are the most positive about hiring prospects. Their Net Employment Outlook (adjusted for seasonal variation) was well above the average at 13%. In fact, the outlook from Western Cape Employers was over double than those of other provinces.
"Employers in Western Cape report the strongest hiring plans with a Net Employment Outlook of +13%. Elsewhere, modest payroll gains are anticipated in Free State and Eastern Cape, with Outlooks of +6% and +5%, respectively, while Outlooks of +4% are reported in both Gauteng and KwaZulu-Natal," the survey said.
Several provinces saw a decline in outlook from the previous quarter though, including the Western Cape. The year-on-year results however do show an increase in confidence. The provinces with the lowest outlooks were Gauteng and KwaZulu-Natal.

Utility Companies Are The Most Optimistic

ManpowerGroup also looked at confidence by sector. The survey showed that the most confident employers were from the electricity, gas and water supply industry. With a Net Employment Outlook of +16%, employers forecast the strongest hiring pace in two years for the coming quarter," the survey says.
"Hiring intentions remain relatively stable when compared with the previous quarter and are 7 percentage points stronger year-over-year."
Employers at restaurants and hotels placed second highest for their employment outlook. Other relatively optimistic industries include manufacturing and finance, insurance and real restate. The outlook for the construction industry isn't as confident though, with the industry actually having a Net Employment Outlook (adjusted) of -4%. This means employers in the industry on average are expecting a decline in staff numbers.
"Job seekers can expect a downbeat labour market in the next three months…The Outlook declines by 7 percentage points quarter-over-quarter but is 5 percentage points stronger year-over-year," the survey says of the construction industry.
We will have to wait until the next quarter's report to see just how much other industries' confidence was hit by the junk status downgrade.

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