‘A Few Minor Bumps’ - Cape Town’s delivers mixed 2nd Quarter economic performance

Cape Town saw a slight increase in unemployment in the second quarter of this year compared with the first quarter, according to the City’s latest Economic Performance Indicators for Cape Town (EPIC) report.

The strict unemployment rate increased from 21,9% in Q1 to 23,3% in Q2, the first decline after four consecutive quarters of positive employment growth, the report notes.

The increase is due largely to a significant increase in the youth unemployment rate, up to 52,7% in Q2 from 45,2% in Q1.

“While this remains well below the national youth unemployment rate of 62,2% recorded in the second quarter of 2025, it is nonetheless high by average developing country standards and continues to pose a key challenge for economic policymakers in the city,” the report notes.

Increased unemployment stemmed from quarterly contractions in some key economic sectors, notably finance, real estate and business services (-40 174), and manufacturing (-20 750).  

Employment gains were recorded in the trade and hospitality (+28 786), private households (+9 038), and community, social and other personal services (+4 284) sectors, the report found.  

The report also provided a snapshot of the Western Cape economy, which grew by 0,7% quarter-on-quarter thanks largely to manufacturing sector growth.

The Economic Performance Indicators for Cape Town (EPIC) is a quarterly publication produced through collaboration between the City of Cape Town’s Economic Development and Investment and Policy and Strategy departments. It provides analysis of key economic trends and developments and this edition covers the second quarter of 2025 (1 April–30 June).  

Despite shedding jobs in Q2, the City’s employment rate is still superior to other metros, with Johannesburg registering 33% strict unemployment, Ekurhuleni 34,7% and Tshwane 30,8%, the EPIC report notes.  Cape Town continues to have the second highest number of employed people (1,78 million), which is second only to far more populous Johannesburg (1,99 million people).

On the plus side Cape Town saw a 9% increase in overall exports thanks to an a whopping 2 456% in seasonal citrus fruit and a 106%  increase in apples, pears and quinces. ON the downside, yacht exports decreased 43% quarter on quarter.  

There were other positive trends and signals, among them a significant increase in average room rate year-on-year in the tourism sector. There was also a 9,5% year-on-year increase in passenger movement at Cape Town International Airport.  

Overall, Cape Town’s performance showed its resilience in the face of global economic headwinds, according to the City’s executive head of economic growth James Vos.

“While Cape Town’s economy experienced a few minor bumps during this quarter (not unlike the country or, in fact, economies across the globe), the city continues to show remarkable resilience and momentum, with growth visible across sectors, trade and investment,” Vos said. “Our city has proven itself to be a global destination and a continental hub, where innovation, entrepreneurship and opportunity converge. From thriving small businesses to major international investments, Cape Town is steadily building an economy that is inclusive, competitive and future-focused,” he said.  

The Cape Chamber would like to recognise Paul Court for doing a great job as Manager of Economic Analysis for this EPIC publication.