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Why Has Unemployment Risen in the New South Africa?

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  • Sebastian Galliani
  • James Levinsohn
  • Ingrid Woolard

Abstract

We document the rise in unemployment in South Africa since the transition in 1994. We describe the likely causes of this increase and analyze whether the increase in employment is due to structural changes in the economy (resulting in a new equilibrium unemployment rate) or to negative shocks (that temporarily have increased unemployment). We conclude the former are more important. Our analysis includes a multinomial logit approach to understanding transitions in individual-level changes in labor market status using the first nationally representative panel in South Africa. Our analysis highlights several key constraints to addressing unemployment in South Africa.

Suggested Citation

  • Sebastian Galliani & James Levinsohn & Ingrid Woolard, 2006. "Why Has Unemployment Risen in the New South Africa?," CID Working Papers 134, Center for International Development at Harvard University.
    • Handle: RePEc:cid:wpfacu:134
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    References listed on IDEAS

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    More about this item

    Keywords

    South Africa; Unemployment;

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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