I recently posted a graph on Twitter showing the past 100 years of South African agricultural employment, which has of course been declining for some time, in line with the international trend. The feedback from a couple of interactions suggested that the agricultural sector is a nonstarter when it comes to job creation. – Wandile Sihlobo, Agbiz economist *Written for and first published in the Business Day on 21 June 2018.
I recently posted a graph on Twitter showing the past 100 years of South African agricultural employment, which has of course been declining for some time, in line with the international trend.
The feedback from a couple of interactions suggested that the agricultural sector is a nonstarter when it comes to job creation. While that sentiment has some validity, it’s worth noting that many developing and developed countries still have a huge chunk of people working in their agricultural sectors – even though this may have declined significantly as a share of overall employment and in absolute numbers.
For instance, Turkey’s agricultural sector employs more than 5.5 million people, the US more than 2.5 million and Mexico more than 6.8 million, according to data from the Federal Reserve Bank of St Louis. In SA, we have about 847 000 people working in the agricultural sector, according to the latest data from Statistics SA.
The areas planted and agricultural activities in the aforementioned countries vary, which partially explains the difference in agricultural labour participation. What is also clear from the domestic data is that the decline in employment over the past couple of decades has not been evenly spread across all agricultural subsectors.
The field crop and horticultural industries have actually seen an uptick in employment due to an expansion in the area planted, which was partly driven by the growing global demand for food and fibre.
In fact, about two-thirds of South African agricultural jobs are now in the field crop and horticultural industries. This alone tells us that if we are to see an increase in agricultural employment, these sectors will have to be a priority.
Fortunately, there is an old but relevant document to guide us on this front: chapter six of the National Development Plan (NDP). I know some people have become a bit despondent about the NDP’s ambitious goal of creating close to 1 million jobs in agriculture by 2030.
This is partly because the political rhetoric has placed little emphasis on the prerequisites for those jobs to materialise.
Among these are the need to bring underutilised land in communal areas and land reform farms into commercial production, expand irrigation systems, and identify and support agricultural expansion in areas that have a high potential for growth and employment. This will require investment and strong and efficient institutions.
Given that there is a need to focus on communal land, KwaZulu-Natal, the Eastern Cape and Limpopo would potentially be focus areas for expansion and growth in the South African agricultural sector. These are also provinces with the highest unemployment.
Overall, my interactions on Twitter might have been correct in terms of a declining share of agriculture relative to total employment. However, the sector cannot be overlooked – there is room for growth and employment. The examples of developed countries often cited show that the agricultural sector can still play an important role in absorbing labour.
South African policymakers should revisit the NDP with a clear intent to create strategies that will enable job creation. The feasibility of the 1 million jobs target aside, I think there is room for expansion, provided the aforementioned prerequisites are put in place.
The key subsector to focus on is horticulture, which is labour intensive and there is a growing demand for horticultural products on the global market.
The upskilling of the agricultural labour force to align it with the changing technological environment, increasing investment, research and development and financial support to developing farmers, are key to improving the prospects of the sector.
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