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Labour Force Participation Rate

If we compare the labour force participation rates, it is clear that the Western Cape
performs well. The labour force participation rate of the Western Cape (68,6%) is 4,9%
higher than the labour force participation rate of the Free State (63,7%), and 22,2%
higher than the Eastern Cape (46,4%). Limpopo has both the lowest unemployment
rate and the lowest labour force participation rate.

There could be a number of factors driving this, but the change in expanded
unemployment rates suggests that the Western Cape has a much more actively
searching labour force.

Official Unemployment Rate versus Expanded
Unemployment Rate
When comparing the official unemployment rate (meeting the criteria of actively
searching) and the expanded unemployment rate (including discouraged workers
who want work but have not actively searched for employment) the results are very
interesting. The Western Cape has the lowest expanded unemployment rate (23,0%).
It is 10.3% lower than Gauteng. In stark comparison, there is a 16.4% difference between
the Western Cape and Free State and 21.5% difference between the Western and
Eastern Cape (which is the highest at 44.5%).

Summary Labour Market Analysis

Extending the analysis beyond looking only at the official unemployment rates
reveals that the Western Cape is performing well in terms of being able to provide job PROVINCIAL OUTLOOK NATIONAL OUTLOOK GLOBAL OUTLOOK GAP HOUSING INVESTOR NARRATIVE SPOT THE OPPORTUNITY PORTFOLIO INSIGHTS KHULISA NEWSLETTER ELECTRIC VEHICLES ENERGY SECURITY LOOKING AT GDP
opportunities for its working aged population.

A comparison of official and expanded unemployment rates further suggests that the
ability of the Western Province to provide job opportunities may be linked to job search
behaviour and plays a role in the province having fewer discouraged workers.

Current Employment Initiatives
The Province’s plans to create employment are clearly articulated through Project
Khulisa. It also plans to create an enabling environment for businesses to grow
and absorb more labour through skills development and improving the ease of
doing business.

Looking beyond employment and unemployment rates alone, it is clear that the labour
market of the Western Cape has been performing better than many other Provinces.

QUARTERLY ECONOMIC BULLETIN 2016 93