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Job Creation and Destruction in South Africa

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  • Andrew Kerr

    ()
    (DataFirst, University of Cape Town)

  • Martin Wittenberg

    ()
    (DataFirst, University of Cape Town)

  • Jairo Arrow

Abstract

Analysts of the South African labour market have predominantly used household surveys to analyse the labour market. It has been more difficult to explore labour demand from the fi rm side, as a result of limited data from relatively small cross sectional firm surveys, mainly funded by the World Bank. We use the Quarterly Employment Survey conducted by Statistics South Africa that allows us to explore how South African enterprises create and destroy jobs, shedding light on many of the policy questions that are relevant in a high unemployment society like SouthAfrica. We fi nd job creation and destruction rates are similar to those found in OECD countries. There is little evidence that labour legislation creates rigidities that prevent fi rms from hiring or fi ring workers.We also find that larger firms are better net creators of jobs than small fi rms and that net job creation rates are negative in manufacturing, consistent with work using household surveys. Our research has important policy implications - particularly for the National Planning Commission's suggestion that new jobs will come mainly from small and medium sized fi rms. Our research suggests this is not likely without changes to policy or legislation. This is a joint SALDRU/DataFirst Working Paper

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Bibliographic Info

Paper provided by Southern Africa Labour and Development Research Unit, University of Cape Town in its series SALDRU Working Papers with number 92.

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Date of creation: 2013
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Handle: RePEc:ldr:wpaper:92

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  1. Neil Rankin, 2006. "The Regulatory Environment and SMMEs. Evidence from South African Firm Level Data," Working Papers 06113, University of Cape Town, Development Policy Research Unit.
  2. Jozef Konings & Olga Kupets & Hartmut Lehmann, 2003. "Gross Job Flows in Ukraine: Size, Ownership and Trade Effects," William Davidson Institute Working Papers Series 550, William Davidson Institute at the University of Michigan.
  3. Paul Cichello & Gary Fields & Murray Leibbrandt, 2003. "Earnings and Employment Dynamics for Africans in Post-apartheid South Africa: A Panel Study of KwaZulu-Natal," Working Papers 03077, University of Cape Town, Development Policy Research Unit.
  4. Alex Hijzen, & Richard Upward, & Peter Wright, . "Job Creation, Job Destruction and the Role of Small Firms: Firm-Level Evidence for the UK," Discussion Papers 07/01, University of Nottingham, GEP.
  5. Berk Özler, 2007. "Not Separate, Not Equal: Poverty and Inequality in Post-apartheid South Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 55, pages 487-529.
  6. Shiferaw, Admasu & Bedi, Arjun S., 2010. "The Dynamics of Job Creation and Job Destruction: Is Sub-Saharan Africa Different?," Proceedings of the German Development Economics Conference, Hannover 2010 59, Verein für Socialpolitik, Research Committee Development Economics.
  7. John Haltiwanger & Stefano Scarpetta & Helena Schweiger, 2008. "Assessing Job Flows Across Countries: The Role of Industry, Firm Size and Regulations," NBER Working Papers 13920, National Bureau of Economic Research, Inc.
  8. Klapper, Leora & Richmond, Christine, 2011. "Patterns of business creation, survival and growth: Evidence from Africa," Labour Economics, Elsevier, vol. 18(S1), pages S32-S44.
  9. Geeta Kingdon & Justin Sandefur & Francis Teal, 2006. "Labour Market Flexibility, Wages and Incomes in Sub‐Saharan Africa in the 1990s," African Development Review, African Development Bank, vol. 18(3), pages 392-427.
  10. Abhijit Banerjee & Sebastian Galiani & Jim Levinsohn & Zo� McLaren & Ingrid Woolard, 2008. "Why has unemployment risen in the New South Africa?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 16(4), pages 715-740, October.
  11. Servaas Van Der Berg & Megan Louw, 2004. "Changing Patterns Of South African Income Distribution: Towards Time Series Estimates Of Distribution And Poverty," South African Journal of Economics, Economic Society of South Africa, vol. 72(3), pages 546-572, 09.
  12. Edwards, Lawrence & Rankin, Neil A. & Schöer, Volker, 2008. "South African exporting firms: What do we know and what should we know?," MPRA Paper 16906, University Library of Munich, Germany.
  13. Alberto Behar, 2010. "Would Cheaper Capital Replace Labour?," South African Journal of Economics, Economic Society of South Africa, vol. 78(2), pages 131-151, 06.
  14. Justin Sandefur, 2010. "On the Evolution of the Firm Size Distribution in an African Economy," Economics Series Working Papers CSAE WPS/2010-05, University of Oxford, Department of Economics.
  15. Kerr, Andrew & Teal, Francis J., 2012. "The Determinants of Earnings Inequalities: Panel Data Evidence from South Africa," IZA Discussion Papers 6534, Institute for the Study of Labor (IZA).
  16. Paul Cichello & Murray Leibbrandt & Ingrid Woolard, 2012. "Labour Market: Analysis of the NIDS Wave 1 and 2 Datasets," SALDRU Working Papers 78, Southern Africa Labour and Development Research Unit, University of Cape Town.
  17. Jeremy R. Magruder, 2012. "High Unemployment Yet Few Small Firms: The Role of Centralized Bargaining in South Africa," American Economic Journal: Applied Economics, American Economic Association, vol. 4(3), pages 138-66, July.
  18. David Neumark & Brandon Wall & Junfu Zhang, 2008. "Do Small Businesses Create More Jobs? New Evidence from the National Establishment Time Series," NBER Working Papers 13818, National Bureau of Economic Research, Inc.
  19. Haroon Bhorat & Halton Cheadle, 2009. "Labour Reform in South Africa: Measuring Regulation and a Synthesis of Policy Suggestions," Working Papers 09139, University of Cape Town, Development Policy Research Unit.
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