The foundational assumption of international trade is that exports yield foreign exchange reserves, increased economic activity and possible improvement in employment levels. In other words, making and selling products to the rest of the world should result in more economic activity, higher production levels and, by extension, the creation of job opportunities for the exporting economy. However, South Africa continues to face the highest unemployment rate, especially among those aged 15 to 24. This is despite growing exports, which yield a consistent surplus. From this perspective, it is clear we must confront a South African paradox of our own times: high unemployment despite growing exports that yield a consistent surplus.The data shows there is no observable mutual growth between exports and employment in South Africa. Taking the 2020-2025 timeframe as a sample, we can observe an interesting paradoxical trend. The country’s total exports to the rest of the world grew from $85.6bn to $116.6bn, a 30.6% increase. The country had a trade surplus of $11.7bn. Despite this, unemployment has remained persistent. In 2020, the average expanded definition of unemployment, which factors in discouraged job seekers, was 42%. Five years later, despite the evident growth in exports and surplus, it was reported at 42.7%. The unemployment rate for young people aged 15 to 24 is higher at 60%, according to Stats SA’s Quarterly Labour Survey from the first quarter of 2026.South Africa’s top four exports include platinum and related products, gold and automotive products. For the years under review, the Stats SA reports show declines for these sectors in terms of employment. For example, the number of people employed in the mining sector decreased from 446,000 in 2024 to 444,000 by the end of 2025, a decline of 4.7% in spite of the 18% growth year on year in the same period for platinum exports, from $9.9bn to $11.7bn.If South Africa’s strong export performance in goods has not translated into broad-based employment creation, the country’s services exports tell a similar story. On paper, the numbers relating to the export of services appear encouraging. Services exports grew from about R186bn in 2014 to more than R263bn in 2023, an increase of more than 40% despite the severe disruption caused by the Covid-19 pandemic. After collapsing during lockdowns, services exports rebounded strongly, suggesting South Africa remains internationally competitive in several service sectors.Yet, the composition of those exports helps explain why rising export earnings have not significantly reduced unemployment. The largest contributor by far is travel services, which generated more than R120bn a year before the pandemic and remains the dominant source of service export revenue. While we concede tourism does create employment opportunities, many of them are seasonal, geographically concentrated, relatively low-paying or vulnerable to external shocks such as pandemics, geopolitical instability and exchange-rate volatility. A recovery in tourism receipts therefore does not necessarily translate into sustained employment growth across the wider economy.Other areas of export growth are even less labour-intensive. For instance, financial services exports increased from about R12.7bn to R18.5bn over the period in review, while telecommunications and computer and information services more than doubled. Exports of intellectual property, business services and digital services also expanded steadily. These are positive developments for economic sophistication and productivity, but they tend to generate high-value output with comparatively fewer employment opportunities. A software firm can earn millions in foreign revenue without increasing the rate of its human capital, while a bank can expand its cross-border services without creating employment opportunities on the scale associated with manufacturing or construction.The strongest growth outside tourism occurred in “other business services”, which more than doubled from R23.5bn to more than R50bn. However, much of this category consists of specialised professional, legal, consulting, engineering and corporate services that require advanced skills. In a country where unemployment is concentrated among those with lower levels of education and skills, export growth in these sectors often benefits a relatively small segment of the labour force.In a country where unemployment is concentrated among those with lower levels of education and skills, export growth in these sectors often benefits a relatively small segment of the labour force.The result is a paradox. South Africa is successfully exporting more services to the world and earning valuable foreign exchange, yet many of the sectors driving that success are either skill-intensive, capital-intensive or concentrated among firms that can increase output without proportionately increasing employment opportunities. The problem, therefore, is not that South Africa is failing to produce goods and services it can export. It is that the country’s export basket, whether in goods or services, is not sufficiently linked to large-scale labour absorption. Similarly to David Autor’s empirical work, which proved “labour market adjustment is incredibly slow and painful”, we conclude the export growth alone, more so taking into account the nature of South Africa’s exports, cannot solve unemployment when the sectors generating that growth are structurally incapable of employing the millions of South Africans who remain outside the labour market. To understand this paradox, one has to also employ Paul Krugman’s foundation to modern trade theory, the new trade theory, which argues that while globalisation overall increases economic efficiency and creates high-value job opportunities, it simultaneously shifts the composition of jobs, often increasing the premium on highly skilled labour while reducing demand for less skilled workers in advanced economies. We think this is what is happening in South Africa’s “trade-employment paradox”.• Prof Ndzendze is a senior director and professor of international relations and Prof Moloi is executive dean of the College of Business and Economics at the University of Johannesburg. They write in their personal capacities.