Eastern Cape enters a recession. Image: Pixabay

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Economic downturn in Eastern Cape: Province slides into recession

High unemployment deepens Eastern Cape’s economic woes as province plunges into recession, with only two sectors showing growth

A recent report by the Eastern Cape Socio-Economic Consultative Council (ECSECC) reveals the province has dipped into recession


Poor economic conditions have impacted some provinces more severely than others, with the Eastern Cape being one of them.

The province is officially in a recession due to significant declines in the construction, manufacturing, and mining industries, which have placed immense pressure on employment, as reported by Business Tech.

As the national GDP contracted in the first quarter, the Western Cape, KwaZulu-Natal, the Northern Cape, and Free State all experienced positive growth. However, the Mpumalanga province contracted by 0.5%. The North West and Eastern Cape provinces experienced decreases of 0.4% and 0.3%, respectively, during the same period.

Unlike other provinces that have experienced economic contractions, the Eastern Cape economy contracted for the third consecutive quarter. Therefore, the Eastern Cape entered a recession in the first quarter of the year.

By definition a technical recession occurs when there is more than two consecutive negative quarters.

On a national level, the Eastern Cape accounted for 7.9% of the country’s GDP. Gauteng (33.9%), KwaZulu Natal (16.6%), and Western Cape (14.2%) were the most significant contributors.


Only two industries in the Eastern Cape recorded positive growth, namely agriculture and electricity.

The industries that influenced the negative growth in GDP in the first quarter the most were construction, manufacturing, mining, and transport.


As a result of the poor economic conditions, unemployment is rife. The current situation will soon transform into more unemployed people than working people.

The ECSECC’s report shows that employment has declined in several industries, including manufacturing, construction, and personal services. Additionally, government services, the province’s biggest employer, contracted in the first quarter of 2024, resulting in a notable loss of jobs.

The Eastern Cape is not far behind the North West in terms of more unemployed people than employed. It has an unemployment rate of 49.1%. The latest Quarterly Labour Force Survey (QLFS) revealed that official unemployment increased by 0.8% from 32.1% in the fourth quarter of 2023 to 32.9% in the first quarter of 2024.