Job Creation and Destruction in South Africa. (14th January 2014)

• Record Type: Journal Article
• Authors: Kerr, Andrew; Wittenberg, Martin; Arrow, Jairo
• Is Part Of: South African journal of economics. Volume 82:Number 1(2014:Mar.)
• Page Start: 1
• Page End: 18
• Publication Date: 2014-01-14
• Subjects: Economics -- Periodicals; South Africa -- Economic conditions -- Periodicals; Économie politique -- Périodiques; Afrique du Sud -- Conditions économiques -- Périodiques; Economie; ECONOMICS; Electronic journals; 330.5
• DOI: 10.1111/saje.12031
• Languages: English
• ISSNs: 0038-2280

Abstract

<abstract abstract-type="main"> <title>Abstract</title> <p>Analysts of the South African labour market have mainly used household surveys to analyse the labour market. It has been more difficult to explore the labour demand of firms, as a result of limited data availability. We use the Quarterly Employment Statistics survey, an enterprise survey conducted by Statistics South Africa, to explore how South African firms create and destroy jobs, thereby shedding light on many of the policy questions that are relevant in a high unemployment society like South Africa. We find that job creation and destruction rates are similar to those found in Organisation for Economic Co‐operation and Development countries. There is little evidence that labour legislation creates rigidities that prevent firms from hiring or firing workers. We also find that larger firms are better net creators of jobs than small firms and that net job creation rates are negative in manufacturing. Our research has important policy implications – particularly for the South African National Planning Commission's 2030 plan, in which new jobs are envisaged to come mainly from small‐ and medium‐sized firms. Our research suggests that this scenario is not likely without changes to policy or legislation.</p> </abstract>