Agricultural employment have taken a significant knock in the last quarter of 2020 despite the sector being declared an essential service early in the Covid-19 lockdown. The Western Cape and KwaZulu-Natal have particularly been hit.
According to the latest figures, unemployment in agriculture grew by 8% in the last quarter of 2020, leaving just more than 810 000 people employed by the sector. This is according to Agbiz and the Bureau for Food and Agricultural Policy (BFAP).
It says the Western Cape had the highest unemployment rate among all the nine provinces, losing approximately 51 000 agricultural jobs since 2019. This is followed by KwaZulu-Natal who now employ 21 000 less people when compared to the same period.
Wandile Sihlobo, chief economist at Agbiz, says the decline was evident across most provinces except for the Eastern Cape, Gauteng and Mpumalanga.
In the last quarter of 2019, agricultural employment grew in these provinces although the new minimum wage might still change the future picture.
With the exception of the Western and Northern Cape, Sihlobo suspects that social distancing measures that were enforced to limit the virus’ spread, might have contributed to the decline in employment.
“Some producers, that would have typically employed seasonal workers around this period, were discouraged. We say this because the Free State, North West, KwaZulu-Natal, and Limpopo were among provinces with a good field crop and horticulture harvest in 2020,” says Sihlobo.
“In the Western and Northern Cape, the decline in (agricultural employment) was caused by the constrained cash flow following the ban of wine and alcohol sales at various interval. The producers in the provinces expressed a similar view.”
Agricultural employment per subsector
from a subsector perspective, only forestry and fisheries recorded an overall increase in employment in the fourth quarter of 2020.
“All other subsectors recorded a decline in employment. However, it is worth noting that the provincial dynamics differ, as is evident in the Eastern Cape, Gauteng, and Mpumalanga, where primary agricultural employment increased.”
Notably, Sihlobo says, the employment data will be of interest in the coming months, following the recent 16,1%-increase in the national minimum wage for farmworkers. Since 1 March 2020, they now earn R21,69 per hour.
“Various commodity groups, especially those heavily affected by the lockdown regulations, have indicated that the recent increase in the minimum wage could cause a further squeeze on cash flow and negatively influence hiring decisions,” he says.
Sihlobo concludes, “From an agricultural perspective, the outlook for 2021 is positive, with prospects of higher yields in horticulture and field crops, as well as good performance in the livestock industry.”