Zimbabwe Consolidated Diamond Company (ZCDC), the country’s largest diamond mining firm, has announced it is laying off 400 workers due to a global slump in the market for natural diamonds. The state-owned company said it had to take the difficult decision to avoid a complete shutdown of its operations.
A company representative confirmed the job cuts in a telephone interview, explaining that ZCDC was forced to either scale down or close altogether. In a separate text message, the representative explained that the miner, which currently has over 1,800 employees, decided to maintain minimal operations while waiting for prices to recover.
“We had two options—either shut down entirely or reduce our operational capacity. We have chosen the latter in order to survive this difficult period,” the representative stated.
The move comes as global diamond prices continue to fall sharply. Experts say the drop is linked to a combination of rising interest in lab-grown diamonds, which are cheaper and increasingly popular, and falling demand for luxury goods in key markets such as China and the United States. These trends have shaken the entire $80 billion global diamond industry, affecting both producers in Africa and retailers in wealthy markets.
Zimbabwe, which has one of the largest diamond deposits in Africa, relies heavily on diamond revenue for foreign exchange. The latest development is therefore expected to worsen the country’s economic challenges, including unemployment and foreign currency shortages.
ZCDC, which was formed in 2016 following the consolidation of diamond mining operations in Marange, has been central to the government’s plan to boost mining sector earnings. The diamond sector is one of the strategic pillars of Zimbabwe’s Vision 2030, which aims to transform the country into an upper-middle-income economy by the end of the decade.
However, the current downturn has hit hard. Industry analysts say demand for rough diamonds has slumped, with many manufacturers cutting back on orders. Lab-grown diamonds, which are created using advanced technology, now account for a growing share of the global diamond market. They are often indistinguishable from natural diamonds and are gaining traction among cost-conscious consumers, especially younger buyers.
In addition to weakening consumer demand, the global economic environment has made things worse. High inflation, rising interest rates, and economic uncertainty have all led consumers to cut back on non-essential spending, including luxury items like diamond jewelry.
The slowdown in China, one of the world’s biggest diamond markets, has also had a major impact. A post-pandemic recovery that many expected to boost the luxury sector has not materialised as strongly as hoped, leaving diamond producers with excess stock and falling prices.
In the United States, inflation and higher borrowing costs have led to more cautious consumer spending. Analysts say this shift is particularly noticeable in engagement ring sales, a traditionally strong market for diamonds.
The impact of the crisis is being felt across the diamond value chain—from mining operations in Zimbabwe and Botswana to jewellery shops in London, Mumbai, and New York. Some international producers have begun stockpiling diamonds rather than selling at a loss, while others are cutting back on exploration and mining activities.
ZCDC’s decision to cut 400 jobs is a reflection of how serious the situation has become. Workers affected by the retrenchment are expected to receive severance packages, although the details have not yet been made public. The company is reportedly hoping that diamond prices will start to recover within the next year, but there is no guarantee.
With more than 1,400 workers remaining, ZCDC says it will continue to monitor global market trends and adjust its operations accordingly. The company has also hinted at the possibility of diversifying its business model in the long term to become more resilient to future market shocks.
The Zimbabwean government, through the Ministry of Mines and Mining Development, is yet to issue an official statement on the retrenchments. However, sources say consultations are ongoing to assess the wider impact on communities around diamond mining areas in Marange.
The diamond industry in Zimbabwe has long been seen as a key driver of economic recovery. But the current crisis shows that even strategic sectors are not immune to global market forces.
