Having written a bit about the promise of employment creation in SA’s agricultural sector, I was, again, given a reality check by the Quarterly Labour Force Survey data for the first quarter of 2019. The data shows that SA’s primary agricultural employment fell 1% year-on-year to 837,000 due to reduced activity in field crops, livestock and forestry, all partly due to unfavourable weather conditions earlier in the year.
From a regional perspective, the provinces that faced notable declines were the Eastern Cape, Northern Cape, Free State, Limpopo and Mpumalanga. However, other provinces saw a marginal uptick.
The data reminded us that SA is still lagging behind its target of creating 1-million agricultural jobs by 2030, as envisaged in the national development plan and constantly advocated by policy makers. As 2030 draws nearer and the statistics continue to show no sign of improvement, the targets become increasingly difficult to attain.
As far as I can tell, if the under-utilised land in the former homelands, underperforming land reform farms, and other parts of the country are not brought into full production with a key focus on labour-intensive sub-sectors, meaningful job creation in agriculture might not materialise.
This especially pertains to the horticulture and field crop sub-sectors, which currently employ two thirds of the primary agriculture labour force of 837,000. The other sub-sector — livestock — can also be prioritised, specifically in areas where environmental factors do not permit horticultural or crop expansion. This would all happen at a time when there is a growing demand for horticultural and protein-rich diets in the global market, which is underpinned by changing consumer patterns towards healthier diets.
This presents an opportunity for SA to partially address its twin challenges of rural unemployment and low economic growth.
The provinces with former homelands that still have tracts of under-utilised arable land that can be prioritised for agricultural expansion are KwaZulu-Natal, the Eastern Cape and Limpopo. These provinces collectively have between 1.6-million to 1.8-million hectares of under-utilised land, according to a 2015 study by McKinsey Global Institute.
Also worth noting is that these particular provinces are characterised by higher levels of unemployment and poverty, so it would make sense for the government to prioritise them for agricultural development in the near term. The starting point for this process would be to articulate a clear policy framework on land reform and water rights, which will encourage investment in the agricultural sector.
Concerted investments would be required for land preparations and provision of irrigation infrastructure, among other aspects of unlocking growth and employment and associated positive welfare effects.
To close off with a near-term forecast, the second quarter of 2019 numbers might remain at levels lower than we saw in the second quarter of 2018 due to an expected reduction in grains and oilseed production. However, this dip could be slight as these industries are not as labour-intensive as the other sub-sectors of SA’s agriculture. Also, the expected annual decline in SA’s wine grape production could also have led to reduced activity in the vineyards.
So, no good news for agricultural jobs in the near term. Concerningly, the statistics are likely to continue being unfavourable as long as we continue to talk the talk on job creation, but fail to walk the walk and put policies in place that promote agricultural investment and growth in communal areas.
*Written for and first published on Business Day on 14 May 2019.
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