“Labour Market Policy Responses amidst Globalisation: The Case of South Africa

Haroon Bhorat, Kezia Lilenstein and Francois Steenkamp

Working Papers from University of Cape Town, Development Policy Research Unit

Abstract: The South African economy is mired in a long-run, low-level growth trap which has entrenched high levels of structural unemployment. The economy has also witnessed a rapid and extensive integration into the global economy, which has exposed it to short-term shocks that adversely impact the labour market. ALMPs have been introduced to address both long-term structural problems as well as immediate crises This paper uses a variety of empirical techniques to assess three ALMPs – a job re-training scheme, a public employment scheme and a wage subsidy scheme – implemented in the post-apartheid period. Expenditure on ALMPs and the number of beneficiaries of these schemes has risen over time. The former comprises 0.4 percent of GDP, and the latter constitutes 1.8 million beneficiaries or 8.7 percent of the labour force. In relation to OECD and LAC countries, the reach, in terms of beneficiaries as share of the labour force, and the extent, in terms of expenditure as a share of GDP, of ALMPs in South Africa is notable. The analysis indicates that poor monitoring and evaluation, government capacity, fiscal leakages, difficulty in balancing trade-offs, and an inability to convert the support offered under the scheme to long-term employment have generally hampered the success of these schemes thus far. The implementation of a rigorous monitoring and evaluation programme for each of the ALMPs is of key importance to assessing the impact of such schemes and tailoring them to ensure increased effectiveness in the future.

Keywords: SMMEs; South Africa; inclusive growth; development; entrepreneurship; informality (search for similar items in EconPapers)
JEL-codes: E2 E26 J26 J4 J46 O1 O17 O4 (search for similar items in EconPapers)
Pages: 65 pages
Date: 2019-11
References: Add references at CitEc
Citations:

Published in Working Paper Series by the Development Policy Research Unit, November 2019, pages 1-65

Downloads: (external link)
https://commerce.uct.ac.za/sites/default/files/con ... PRU%2520WP201903.pdf First version, 2019 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ctw:wpaper:201903

Access Statistics for this paper

More papers in Working Papers from University of Cape Town, Development Policy Research Unit Contact information at EDIRC.
Bibliographic data for series maintained by Waseema Petersen ( this e-mail address is bad, please contact ).