The 1% rise in the unemployment level in the first quarter of 2025 raises another red flag about South Africa’s weak growth performance.

Prof Raymond Parsons, economist from the North-West University (NWU) Business School, says with the gross domestic product (GDP) growth forecasts for 2025 having been progressively reduced by various institutions and economists to about 1,5% and below, it is not unexpected that this should now be reflected in higher unemployment levels.

“The overall total unemployment level is now where it was a year ago and youth unemployment in particular remains of an unacceptable magnitude.”

Prof Parsons says the latest rise in unemployment again confirms that economic growth in South Africa has been too low for too long.

“There is no magic wand to create jobs overnight, as the disappointing unemployment picture is the cumulative outcome of seasonal, cyclical and structural factors. However, the deteriorating employment outlook nonetheless reinforces once more the fact that the third Budget on 21 May must be a growth-driven one.”

According to Prof Parsons, the Budget needs to create a policy environment that promotes economic expansion and boosts investor confidence.

He says the Budget must be dedicated to policies and projects that demonstrably support the commitment of the Government of National Unity to at least 3% GDP job-rich growth in the medium term.