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Employment spillover effects of Information and Communication Technologies in the non-ICT industries: evidence from South Africa’s agro-processing industries

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  • Lefophane, Hilda

Abstract

The study aims to analyse the employment spillover effects of ICT in the non-ICT industries. For the empirical analysis, the Pooled Mean Group (PMG) model was used to account for the short-and long-run effects of ICT investment on employment growth of agro-processing industries (i.e. non-ICT industries). The analyses were conducted in a multivariate setting to establish whether labour productivity and output growth effects of ICT investment would spill over to employment growth in those agro-processing industries that invested in ICT more intensively. The findings showed that the labour productivity and output growth effects of ICT investment would be realised in the long run and such effects would spill over to employment growth of the industry group that invested more in ICT. Two implications can be derived from these findings. First, the effects of ICT on employment growth differ according to the intensity of ICT investment, such that employment spillover effects of ICT would be realised by the agro-processing industries that invested in ICT more intensively. Second, such effects would be realised in the long run, suggesting that it would take longer for the returns on ICT investment to be realised. Therefore, policymakers should prioritise the agro-processing industries that are more ICT-intensive for ICT-related investments. Such investments should be undertaken over the long term, as the returns on ICT investment take time to materialise.

Suggested Citation

  • Lefophane, Hilda, 2023. "Employment spillover effects of Information and Communication Technologies in the non-ICT industries: evidence from South Africa’s agro-processing industries," 2023 Seventh AAAE/60th AEASA Conference, September 18-21, 2023, Durban, South Africa 364831, African Association of Agricultural Economists (AAAE).
    • Handle: RePEc:ags:aaae23:364831
    DOI: 10.22004/ag.econ.364831
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