Working in Johannesburg?
Working in Johannesburg
At a Glance:
- While the Central Business District was once the economic heart of Johannesburg, in more recent years Sandton has become the main driving force behind the metro region’s economy.
- The unemployment rate in the Gauteng region was just under 30 percent in the second quarter of 2018.
- If you are present for more than 91 days in South Africa, you are required to pay income tax between 18 percent and 45 percent.
A Look at the Economy
While the gold mining era is over — gold was the main reason behind the city’s founding in the first place — Johannesburg has still managed to preserve its leading position within the South African economy. The province of Gauteng (which Johannesburg is located in) in fact makes up a third of the national GDP, being the seventh largest economy on the African continent.
The city today shares many common traits with other modern expat magnets around the world, such as its service and trade heavy economy, and its powerful financial sector. Johannesburg is also an important center for South Africa’s IT, media, and broadcasting sectors. Mining and manufacturing also play a large role in the city’s economy . While mining no longer takes place within the vicinity of the city, many mining companies still have their headquarters in Johannesburg. Furthermore, heavy industries such as concrete and steel are among the major employers of the city.
Sandton — The Economic Heart of Johannesburg
While you might expect the economic heart of the city to be the city center, it is actually the suburb of Sandton to the north of the city that is the main driving force behind the metro region’s economy. After the economic downturn in the mid-1990s and the urban blight that directly affected companies working in Johannesburg’s Central Business District (CBD), many closed their shops and relocated to Sandton. Among those that relocated was the JSE Securities Exchange — Johannesburg’s stock exchange.
Today, Sandton is home to some of the most prestigious offices in the entire metro area, and many multinationals opt for a Sandton-based operation. Another mainstay of Sandton’s economy is being the home of one of Africa’s largest and most renowned shopping malls, Sandton City. Even those who don’t work in Johannesburg are familiar with the suburb’s name: as a major convention center, it hosts many businesspeople working in a variety of different sectors throughout the year.
Economic Challenges for Johannesburg
For a more general overview on the problem of unemployment in the nation as a whole, please refer to our article on working in South Africa.
In Gauteng, the official unemployment rate was just under 30 percent in the second quarter of 2018. Many South Africans, therefore, turn to the informal sector, working as street vendors and unskilled laborers. The problems of this sector are manifold: trying to abolish or criminalize it is absolutely not an option, as over one million people in the Gauteng area alone depend on the income generated by this cash-only sector. The city and its economy simply cannot provide enough jobs that the many unskilled laborers could fill. Still, the city administration has pledged to reduce unemployment to below 20 percent by 2021 in their 2017/2018 Integrated Development Plan Review.
While a portion of the revenue generated in the informal sector also flows back into the formal sector, there is a loss of tax revenue which Johannesburg could use to further improve its infrastructure and public housing situation. Another problem is the fact that working in Johannesburg’s vast informal sector is not a particularly sustainable source of income. However, for better or worse, the informal sector secures the livelihood of a large part of the city’s population.
Opportunities for Expats
Another challenge which is not limited to Johannesburg, but affects all of South Africa, is “brain drain”. Highly qualified personnel with years of training and/or experience, often gained outside of South Africa, frequently see no point in working in Johannesburg when they could make a more than comfortable living abroad. This leads to a lack of skilled professionals in key positions.
However, “brain drain” is also the largest source of opportunities for expats in Johannesburg. With the right set of skills and a convincing CV, you should not face too much adversity on your road towards working in Johannesburg, an experience that will no doubt pay off.
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