Pretoria — The decline in the unemployment rate down to 24.9% in the second quarter from 25.2% in the first quarter is encouraging, says Nedbank.
Releasing the Quarterly Labour Force Survey on Tuesday, Statistics South Africa said that the unemployment rate declined by 0.3% with the number of employed persons increasing by 25 000 people.
"Behind the increase in employment was an increase in formal sector employment of 62 000, while employment in the informal sector decreased by 21 000," said Stats SA.
The highest numbers of jobs over the quarter were created in the community and social services category followed by the construction and mining sectors.
"The decline in the unemployment rate is encouraging," said Nedbank, adding that indicators suggested that global economic conditions deteriorated even further in the second quarter and were expected to remain weak in the months ahead.
Companies were likely to remain cautious in employing more people.
"Some improvement in employment could be expected from the public sector as the government accelerates its infrastructure spending," said the bank.
"These numbers are not likely to influence the Reserve bank's stance in the short-term. With softer global demand, slowing domestic spending and an improved inflation outlook, we expect interest rates to remain stable well into 2013, when some reversal in policy easing then becomes possible."
Following a meeting of the Reserve bank's Monetary Policy Committee, Governor Gill Marcus recently announced the reduction of the repo rate from 5.5% down to 5%, a surprise reduction which was welcomed.