pre-feasibility assessment report - Innovationeasterncape.co.za

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African Development Economic ConsultantsADECother inputs to the big auto companies. Huge investments have been made inindustrial development projects, such as Coega, in support of these industries.Further, NMB is home to the Automotive Industry Development Centre (AIDC),which supports the activities of SMMEs and regional suppliers to the originalequipment manufacturers (OEMs). Nelson Mandela Metropolitan University(NMMU) is based in the city, and also provides substantial technical support toarea suppliers. The city has a particular niche in the production of catalyticconverters. These activities help to solidify the city’s position as a manufacturinghub for the automotive industry.Aside from supplying the automobile industry, NMB companies alsoproduce pharmaceuticals, food and beverages, lighting products, plastics,building materials, apparel, wool and mohair, and other products.Employment. The economic base in Nelson Mandela Bay MetroMunicipality (NMB) is heavily dominated by Manufacturing, which accounts for25% of formal resident employment. As noted previously, there are severallarge automotive assembly plants located in NMB, and these plants contractwith various suppliers throughout the area. Thus, there are a number ofcompanies supplying the automotive industry.Community Services is also important, accounting for 18% of jobs held byresidents in the municipality. As in the province as a whole, community servicesjobs are supported largely through public sector funding. Wholesale and retailtrade accounts for the third largest employment group, with 16%. As acommercial hub, Port Elizabeth draws consumer and business trade fromthroughout the province. Finance, insurance, and real estate businessesaccount for 13% of NMB residents’ employment base. Again, NMB is a hub fortrade and commerce for the region. Other industries such as transport,communications, construction, utilities, agriculture, and mining play a relativelysmall role in the local economy.103 Algernon Road, Norwood (Johannesburg). Tel (011)728-1965 / 6690 Fax (011)728-8371Adec@ADEC1.com. Suite 131, Private Bag X5, Norwood 2117 SOUTH AFRICA 8
African Development Economic ConsultantsADECEmployment Trends. Overall, formal employment has not increased asrapidly in NMB as in the province as a whole. Total formal resident employmentwas estimated at about 240,000 in 2007, up by 36,000 or 17.6% since 2001 (or2.9% per annum). Still, this growth is substantial, accounting for about 17% ofall employment growth in the province. This share is slightly higher than NMB’sportion of the province’s population base.Table 3.RESIDENT EMPLOYMENT TRENDS BY MAJORSECTOR, NELSON MANDELA BAY METROPOLITANMUNICIPALITY, 2001-20072001-2007 ChangeIndustry Sector 2001 2007 Number Percent Per YearAgriculture 5,613 8,304 2,691 47.9% 8.0%Mining 353 1,122 769 217.8% 36.3%Manufacturing 48,821 60,889 12,068 24.7% 4.1%Utilities 760 1,841 1,081 142.2% 23.7%Construction 10,839 19,432 8,593 79.3% 13.2%Trade 36,776 38,682 1,906 5.2% 0.9%Transport/Comm 12,263 10,877 -1,386 -11.3% -1.9%FIRE 21,662 30,817 9,155 42.3% 7.0%Comm Services 48,284 44,253 -4,031 -8.3% -1.4%Other 18,622 23,674 5,052 27.1% 4.5%TOTAL 203,993 239,891 35,898 17.6% 2.9%Notes:Sources:Agriculture includes agriculture, hunting, forestry and fishing.Utilities includes electricity, gas and water supply.Trade includes retail and wholesale trade.FIRE is finance, insurance, real estate and business services.Other is industries not elsewhere classified (NEC)/undetermined.Statistics South Africa and ADEC.Employment has shifted even more heavily towards manufacturing inNMB, with the share of employment in that sector increasing from 23.9% in2001 to 25.4% by 2007. The manufacturing sector added over 12,000 jobsduring that six-year period, yielding a growth rate of 24.7% or 4.1% per year.The most rapidly-growing sectors in NMB include mining (217.8%), utilities(142.2%), construction (79.3%), agriculture (47.9%), and FIRE (42.3%). Otherthan manufacturing, the financial (FIRE) and construction sectors added thelargest numbers of jobs (9,200 and 8,600, respectively) during this period. Whilegrowth was rapid in the mining and utilities sectors, the baseline was so smallthat the addition of a relatively few jobs can skew the numbers upwards.Several sectors of the NBM economy actually lost employment basebetween 2001 and 2007, including transport and communications (1,386 or -103 Algernon Road, Norwood (Johannesburg). Tel (011)728-1965 / 6690 Fax (011)728-8371Adec@ADEC1.com. Suite 131, Private Bag X5, Norwood 2117 SOUTH AFRICA 9
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