Young people were once again hardest hit as South Africa’s unemployment rate surged more than expected in the first quarter of 2026, with little prospect of improvement for the rest of the year as the Middle East war weighs on the economy.
The labour federation Cosatu, increasingly critical of the government despite its alliance with the ANC and the South African Communist Party, said rising joblessness is becoming a ticking time bomb for the country.
“The latest jobs report released by Stats SA … is beyond depressing,” Cosatu parliamentary co-ordinator Matthew Parks said.
“Unemployment is the single greatest threat to the nation. It requires the same decisive and progressive response as was mobilised and led by President Cyril Ramaphosa during Covid-19. This is a ticking time bomb we dare not ignore.”
The overall jobless rate surged to 32.7% in the first quarter of 2026 from 31.4% in the final quarter of 2025, data from Stats SA showed on Tuesday. Unemployment among people aged 15 to 34 was even higher at 45.8%.
The total number of employed people in the country decreased by 345,000 to 16.8-million, while the number of people without jobs rose 301,000 to 8.1-million during the period.
The number of discouraged job-seekers was up 178,000 to 3.9-million, other available job-seekers increased by 55,000 to 910,000, and unavailable job-seekers increased by 6,000 to 49,000, resulting in a total net increase of 240,000 to 4.9-million in the potential labour force population.
The unemployment crisis could spell trouble for the parties in the national ruling coalition led by the ANC when South Africans vote in local government elections set for November 4.
In his state of the nation address in February, Ramaphosa said the country’s chronic joblessness and the struggle for young people in particular to secure their first job were national concerns.
On Tuesday, DA leader Geordin Hill-Lewis, whose party is the second largest in the coalition formed after the May 2024 general elections, laid the blame for the scourge squarely at the ANC’s feet, suggesting it is too distracted by issues such as the Phala Phala scandal engulfing the president to pay proper attention to the country’s economic problems.
“While the internal ANC crises affect their performance in national government — things like Phala Phala and criminal infiltration — they remain distracted from reform, and South Africans are paying the price in lost wages, closed opportunities and families left behind,” Hill-Lewis said.
“The DA will continue to push for the reforms needed to turn this economy around, including cutting red tape, fixing basic services, enabling private sector participation in ports and rail, making communities safer and creating the conditions for investment-led job creation.”
Stats SA said the total number of those aged 15-34 who were without jobs rose by 181,000 to 4.7-million in the first quarter. Employment in that cohort fell by 258,000 to 5.6-million.
“Young people aged 15 to 34 years are [more] vulnerable to labour markets compared to those in older age cohorts. For those who are 35 to 64 years, the unemployment rate is sitting at 23.4%, whereas that of young people 15-34 years is sitting at 45.8%,” statistician-general Risenga Maluleke said.
Data from the Centre for Development and Enterprise shows that nearly half of South African graduates are unemployed or underemployed within the first year of graduating.
The increasing use of AI in South Africa has left thousands of young prospective employees at a disadvantage because they lack the basic skills in fields that are now being demanded by employers, an industry expert said recently.
Maluleke said it is still too early to assess the effects on South African jobs of the Middle East war pitting the US against Iran, which has pushed production costs for businesses significantly higher due to more expensive fuel, particularly diesel.
“The shocks in the Middle East started [being sustained] in March, and this was our concluding month in the field. So it’s still too early to tell. We will know in future quarters if there’s any effect,” he said.
The labour market outlook remains uncertain heading into the second quarter, with the conflict introducing new headwinds, Nedbank economists Busisiwe Nkonki and Nicky Weimar said.
“The US-Iran war has disrupted global supply chains, driving up oil prices, which have already translated into rising energy and transport costs. This shock is expected to place pressure on oil-intensive sectors through higher input costs and potentially supply disruptions,” they said.
“Employers will face greater cyclical pressures in the months ahead, which pose significant downside risk to job creation. Consequently … rising unemployment appears likely during the remainder of the year.”
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