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The Effect of Minimum Wages on the Employment and Earnings of South Africa's Domestic Service Workers

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  • Tom Hertz

    ()
    (American University
    American University)

Abstract

Minimum wages have been in place for South Africa's one million domestic service workers since November of 2002. Using data from seven waves of the Labour Force Survey, this paper documents that the real wages, average monthly earnings, and total earnings of all employed domestic workers have risen since the regulations came into effect, while hours of work per week and employment have fallen. Each of these outcomes can be linked econometrically to the arrival of the minimum wage regulations. The overall estimated elasticities suggest that the regulations should have reduced poverty somewhat for domestic workers, although this last conclusion is the least robust.

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Bibliographic Info

Paper provided by W.E. Upjohn Institute for Employment Research in its series Upjohn Working Papers and Journal Articles with number 05-120.

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Date of creation: Aug 2005
Date of revision:
Handle: RePEc:upj:weupjo:05-120

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Keywords: minimum; wage; south africa; hertz; earnings; hours;

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Cited by:
  1. Ronelle Burger & Marisa Coetzee & Carina van der Watt, 2013. "Estimating the benefits of linking ties in a deeply divided society: considering the relationship between domestic workers and their employers in South Africa," Working Papers 18/2013, Stellenbosch University, Department of Economics.
  2. Dinkelman, Taryn & Ranchhod, Vimal, 2012. "Evidence on the impact of minimum wage laws in an informal sector: Domestic workers in South Africa," Journal of Development Economics, Elsevier, Elsevier, vol. 99(1), pages 27-45.
  3. Bhorat, Haroon & Kanbur, Ravi & Mayet, Natasha, 2013. "The Impact of Sectoral Minimum Wage Laws on Employment, Wages, and Hours of Work in South Africa," Working Papers, Cornell University, Department of Applied Economics and Management 180096, Cornell University, Department of Applied Economics and Management.
  4. James A. Levinsohn & Todd Pugatch, 2011. "Prospective Analysis of a Wage Subsidy for Cape Town Youth," NBER Working Papers 17248, National Bureau of Economic Research, Inc.
  5. Pauw, Karl & Leibbrandt, Murray, 2012. "Minimum Wages and Household Poverty: General Equilibrium Macro–Micro Simulations for South Africa," World Development, Elsevier, Elsevier, vol. 40(4), pages 771-783.

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