MAIN IMAGE: John Loos – independent economist
Opinion
South Africa’s economic conversation has shifted sharply toward Gauteng and Johannesburg, and while that focus is warranted, it risks obscuring a deeper structural problem. The country has long relied on just two provincial economies, Gauteng and the Western Cape, to drive growth and absorb employment. With Gauteng’s labour absorption ratio falling from 57,1 in 2008 to 44,3 in early 2026, one of those engines is losing power, and that has consequences well beyond the province’s borders.
Gauteng does not operate in isolation. It functions as the services and economic hub for a broader inland region that includes Mpumalanga, Limpopo, the Free State and North West, five provinces that together account for nearly 60% of national GDP. All four of Gauteng’s neighbouring provinces have lower labour absorption ratios, and three have seen those ratios decline since 2008. Weak job creation in surrounding regions drives population pressure into Gauteng, straining infrastructure and services that are already under stress.
The Western Cape offers a useful counter-model, where Cape Town’s economic performance is reinforced by well-functioning surrounding towns that have become growth nodes in their own right, sharing the population load. South Africa needs more of that kind of distributed regional strength. John Loos argues, using the analogy of Brazil’s 7-1 World Cup semifinal defeat, the country’s problem is not only its newest wound but the longer-standing lack of squad depth across its regional economies.
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