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Human Capital Constraints in South Africa: A Firm-Level Analysis


  • Ewert P. J. Kleynhans

    (School of Economics, North-West University, South Africa)

  • Johannes Riaan Labuschagne

    (School of Economics, North-West University, South Africa)


This paper examines human capital constraints in the South African economy, and the austerity of these constraints on firms in the country. The two key human capital constraints explored in this article are the inadequately educated workforce and labour market distortions. Regression analysis was applied to examine determinants of increased labour productivity in manufacturing firms. Education and labour market distortions were found to have a varying influence on output per worker. Principal Component Analysis (pca) of the explanatory variables achieved similar results. This study found that the highest percentage of the total variance is explained by latent variables that incorporate education, training, compensation, region and Sector Education Training Authority (seta) support and effectiveness.

Suggested Citation

  • Ewert P. J. Kleynhans & Johannes Riaan Labuschagne, 2012. "Human Capital Constraints in South Africa: A Firm-Level Analysis," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 10(1 (Spring), pages 69-86.
  • Handle: RePEc:mgt:youmgt:v:10:y:2012:i:1:p:069-086

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    References listed on IDEAS

    1. Gary S. Becker & Kevin M. Murphy & Robert Tamura, 1994. "Human Capital, Fertility, and Economic Growth," NBER Chapters,in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition), pages 323-350 National Bureau of Economic Research, Inc.
    2. Haroon Bhorat & Paul Lundall, 2004. "Employment, Wages And Skills Development: Firm-Specific Effects - Evidence From A Firm Survey In South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 72(5), pages 1023-1056, December.
    3. Johannes Fedderke, 2005. "Technology, Human Capital and Growth," Working Papers 27, Economic Research Southern Africa.
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    Cited by:

    1. Rulof P. Burger & Francis J. Teal, 2014. "The effect of schooling on worker productivity: Evidence from a South African industry panel," Working Papers 04/2014, Stellenbosch University, Department of Economics.

    More about this item


    human capital constraints; productivity; efficiency; labour; education; manufacturing; South Africa;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity


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