South African mining entered recession with its second consecutive quarter of economic decline. This was revealed in the recent figures released by Statistics South Africa (Stats SA).

“Production was down 9,9% in the first quarter of 2018, following on from a decrease of 4,4% in the fourth quarter of 2017,” said Stats SA on figures released on 5 June.

The poor performance has also contributed to the overall decline of performance of the economy.

“Lower production in gold, platinum group metals and iron ore were the main contributors to falling performance.”

The South African economy wobbled in the first quarter of 2018, shrinking by 2,2% quarter-on-quarter (seasonally adjusted and annualised).

Sectors which contributed to this decline are: agriculture, mining and manufacturing were the main contributors to the slowdown, with the electricity, construction and trade industries also recording negative growth.

With these figures companies are likely to see a jobs bloodbath. Companies, especially in the mining sector, prioritise profits ahead of people and when industry is facing challenges the first mechanism they use is shedding jobs.

Last month (May) AngloGold Ashanti, a global gold mining company with exploration projects in South Africa, announced that it was planning to shed 25% of its labour force in South Africa.

“While all efforts will be made to limit the impact on employment, the current restructuring process contemplates some 2 000 roles across AngloGold Ashanti’s South African business, which currently employs roughly 8 200 people,” said the company through a statement.