Agricultural employment reaches a seven-year high

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The data released recently by Statistics South Africa paints an encouraging picture of agricultural employment. In the second quarter of 2023, approximately 894 000 people were employed in primary agriculture, up 1% quarter-on-quarter (q/q) and 2% year-on-year (y/y).

This is the highest farm employment level since the last quarter of 2016 and is well above the long-term agricultural employment of 780 000. From a regional perspective, the Western Cape, Eastern Cape, Northern Cape, and KwaZulu-Natal were the significant drivers of this employment.

The robust production conditions of various field crops, forestry and aquaculture were behind the improvement in agricultural jobs in the second quarter. Meanwhile, the livestock industry saw modest improvement, which is unsurprising since the industry is still dealing with the tail-end effects of the foot-and-mouth disease period and higher feed costs. There also was a notable decline in the game industry and in the production of organic fertilisers.

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Overall, this notable improvement in employment in the second quarter is unsurprising as South Africa has a good field crop and horticulture harvest following favourable rainfall. At the start of the season, production was threatened by persistent load shedding.

Still, the various interventions to ease the load shedding burden on producers, such as load curtailment, expansion of the diesel rebate to the food value chain, and most private sector investment in alternative energy sources, all supported the production conditions.

Hence, the 2022/23 maize harvest is estimated at 16,4 million tonnes, 6% higher than the 2021/22 season’s harvest and the second-largest harvest on record. The soya bean harvest could reach a record 2,8 million tonnes. South Africa’s sugar cane crop will likely increase by 3% to 18,5 million tonnes in 2023/24.

Other field crops and fruit also show prospects for decent harvest this season, which underpins the favourable jobs data. In the coming weeks, the focus will also be on the effectiveness of the recently announced Agro-Energy Fund and the application details.

The key challenges the sector faces include rising geopolitical tension, deteriorating infrastructure, weakening municipalities, crime, and energy supply. These factors influence farm profitability and job prospects. The South African government, collectively with the private sector, should address these issues to support long-term in the sector.

Another factor to watch out for is El Niño’s forecast for the upcoming 2023/24 summer season, which could have a negative impact on the sector. However, we are optimistic that it will be mild and that production will remain at decent levels, and consequently, employment will be maintained. – Wandile Sihlobo, Agbiz

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