Research on the performance of the manufacturing sector
Employment in the manufacturing sector
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- Figure 10: Formal sector employment in the manufacturing sector (2000 to 2011)
- Figure 11: Year-on-year percentage change in manufacturing employment
- Table 6: Employment output ratios (including informal sector) at constant 2005 prices by industry, 2001 to 2010
- Industry 2001 2002
Employment in the manufacturing sectorFigure 10 shows the formal manufacturing employment figures from 2000 to 2010 for the major manufacturing sub-sectors. According to this data, the formal manufacturing lost almost 150 000 employment opportunities between 2000 and 2010, or 11.3% of its labour force. The trend in employment numbers shows a slight decrease after 2000 (after the dot com bubble burst in the US) and a slight increase after that up to 2006 (at 1.33 million manufacturing employment in SA). From there on the employment trend decreased to around 1.17 million in 2010. The figure also shows that the metals, metal products, machinery and equipment sub-sector is the largest employer (estimated at 25% or 291 854), followed by the food, beverages and tobacco industry at 18% of total employment and petroleum products, chemicals, rubber and plastics at 12%. The Radio, TV, instrument, watches and clocks sector only makes up 1.4% of total employment while electrical machinery and apparatus only makes up 3% of employment. Figure 10: Formal sector employment in the manufacturing sector (2000 to 2011)  Source: Quantec data
The year-on-year percentage change in the employment data is shown in Figure 11. The textiles, clothing and leather lost on average the most employment opportunities, averaging an average of -5.1% lost per year (more than 75 000 formally lost opportunities since 2000). This is followed by furniture and other manufacturing that lost on average -2.6% employment opportunities per year. Metals, metal products, machinery and equipment shows an average increase of 1.08% between 2000 and 2010, petroleum products, chemicals, rubber and plastics and wood and paper, publishing and printing also shows a slight increase at 0.32% and 0.02% respectively over the period. Figure 11: Year-on-year percentage change in manufacturing employment  Source: Quantec data
Table 6 shows the employment output ratios (number of employees needed to produce R1 million of economic output at constant 2005 prices) from 2001 to 2010 for manufacturing industries. If the policy goal is to support labour intensive sectors, it is important to see what sectors are labour intensive. It is however; also important to see how this labour intensity changes over time and also important to look at the long run sustainability and profitability of the sector. The data shows a decreasing trend in most of the industries, especially labour-intensive sectors such as clothing, textiles, leather, and leather products, footwear and furniture (textiles for example decreased from 9.9 employees per R1 million in 2001 to 6.3 employees per R1 million in 2010 – measuring it at constant prices). This highlights the need for sufficient government policy, including labour policy, education, training, etc to solve the unemployment problems in South Africa. It also demands a big turnaround needed in a number of sectors to reach government employment targets indicated for example in the New Growth Path. Table 6: Employment output ratios (including informal sector) at constant 2005 prices by industry, 2001 to 2010
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