South Africa's official unemployment rate rose to 33.7% in the third quarter from 33.6% in the second, even though the economy added 101,000 jobs, because more people entered the labour force than found work, Statistics South Africa said on Tuesday.

The figures matter beyond Pretoria. The rand and South African government bonds are among the most widely traded emerging-market assets from Africa, and many global bond funds that invest in Asia also hold them. A labour market that cannot absorb new workers limits tax revenue and household spending at a time when the Treasury is trying to stabilize its debt, and when an oil price shock tied to disruption in the Strait of Hormuz has already squeezed companies and consumers.

Jobs grow, but the labour force grows faster

Employment rose to 16.8 million in the July to September quarter, according to the Quarterly Labour Force Survey. The labour force expanded by 198,000, or 0.8%, so the number of unemployed people climbed by 97,000 to 8.6 million, the government news agency SAnews reported, citing Stats SA.

The quarter's gain followed two weak readings. Employment fell by 345,000 in the first quarter and by a further 16,000 in the second, according to Anchor Capital, a Johannesburg investment firm. Compared with a year earlier, employment was 215,000 lower and the number of unemployed was up 571,000, or 7.1%, Anchor Capital said.

Broader measures were mixed. The rate that adds people who want work but are not actively looking, known as the expanded rate, rose to 44.0% from 43.8%. The number of discouraged job seekers rose by 70,000 to 3.7 million. Youth unemployment, covering people aged 15 to 34, eased by 0.1 percentage point to 47.3%.

Reuters noted that the official rate has stayed above 30% for six years.

Finance and mining hire, households and farms cut

The mix of jobs was better than the headline. Formal-sector employment rose by 268,000 to 12.3 million, while the informal sector shed 98,000 jobs and private households, which employ domestic workers, cut 68,000.

Finance added the most jobs of any industry, at 111,000, followed by manufacturing with 33,000 and mining with 31,000, Stats SA said. Mining employment rose 6.8% from the prior quarter, according to Anchor Capital. Mines that sell metals and coal to Asian buyers have faced cost pressure this year; Valterra Platinum reported lower refined output and higher costs in its latest update.

Agriculture lost 34,000 jobs and construction 8,000.

By province, the Western Cape added 48,000 jobs and North West 45,000, while the Free State lost 34,000 and Mpumalanga 30,000. The Eastern Cape had the highest jobless rate at 44.3% and the Western Cape the lowest at 19.4%, Anchor Capital said.

Weak growth and higher rates weigh on hiring

The broader economy gives employers little reason to hire quickly. Gross domestic product shrank 0.2% from the prior quarter in the April to June period, ending six quarters of growth, and the RMB/BER business confidence index fell to 38 in the third quarter, its lowest since the third quarter of 2024, Anchor Capital economist Lerato Ntuli wrote. The South African Reserve Bank has raised its repo rate twice this year, most recently to 7.25% in September.

Nedbank economists said before the release that higher oil and fuel prices had raised input costs and cut into profits, and that they expected companies to be more cautious about adding staff, Reuters reported.

Ntuli pointed to some relief: Brent crude has fallen about 20% from its late-October highs, the government began a temporary cut to the fuel levy on Nov. 4, and retailers usually hire for the festive season. She expects those factors to do little to change the underlying trend, and expects job creation to stay modest until confidence and investment recover.

Markets were calm going into the release. The rand traded at 16.36 per dollar early on Tuesday, little changed from its previous close of 16.3828, and the yield on the benchmark 2035 government bond fell 1.5 basis points to 8.25%, Reuters reported. The jobs data add to pressure on public finances that the Treasury set out in its medium-term budget, which cut the growth forecast.

September manufacturing output was also due on Tuesday. Analysts polled by Reuters expected a 2% year-on-year fall after a 4.3% drop in August.