Extremely high levels of unemployment contribute to poverty and inequality, and are one of South Africa’s most intractable problems. Can the agricultural sector help to address the problem? And how can land reform be undertaken in a manner that creates more jobs? The farming sector, together with forestry and fisheries, currently contributes around 2% to GDP and around 5% to total employment, with a total of 840 000 workers. The contribution of agriculture to GDP is in fact somewhat greater than 2%, given the contributions of input (‘upstream’) suppliers and agroprocessing (‘downstream’) industries. Around 30 000 medium- to large-scale commercial farmers supply the bulk of produce to formal markets, and employ most farm workers. Perhaps 5 000 of such medium- to large-scale
commercial farmers are black, but most black farmers operate on a much smaller scale. They are either subsistence-oriented (around 2 million) or market oriented smallholders (around 200 000) and operate informally. A large-scale programme of rural land redistribution, necessary for political reasons, should also have a sound economic rationale. Its primary goal must be to improve the productivity and incomes of market oriented smallholder farmers, thus laying the foundation for a more equitable commercial agricultural sector.
