Public sector cannot absorb the unemployed‚ says Zuma

He was speaking to captains of industry and labour leaders in Cape Town‚ ahead of his State of the Nation address later in the week.

He said that government expected economic growth of 1.3% in 2017.

“Improved commodity prices‚ and stronger global growth should encourage both investment and employment‚ and provide necessary support for exports‚” he said.

“Agriculture is expected to recover following improved weather conditions‚ while tourism and the manufacturing sector should be supported by the weaker rand and a recovery in economic activity in the region. We have reason to be optimistic.”

But despite the improved outlook‚ “we have to acknowledge that we are not growing fast enough to significantly reduce our triple challenges of poverty‚ inequality and unemployment”.

Unemployment stood at 27.1% - the highest rate since June 2004‚ he added.

“Low economic growth and pressure on revenue suggest that the public sector can no longer be the main engine of jobs growth. We used to rely on government to absorb the unemployed. The public service is also facing pressure‚” he said.

Zuma said that the scale of inequality and exclusion in the country had to be confronted urgently. Two decades since democracy‚ the country’s black majority remained mostly outside of the main stream economy.

“Social justice cannot be achieved if we allow the status quo to persist‚” he said.