Surviving unemployment without state support: Unemployment and household formation in South Africa

dc.creatorKlasen, Stephen
dc.creatorWoolard, Ingrid
dc.date2013-10-11T12:36:55Z
dc.date2013-10-11T12:36:55Z
dc.date2005-10
dc.date.accessioned2015-05-28T10:06:28Z
dc.date.available2015-05-28T10:06:28Z
dc.date.issued2015-05-28
dc.descriptionWhile in many African countries, open unemployment is largely confined to urban areas and thus overall rates are quite low, in South Africa (and a few other Southern African countries), open unemployment rates hover around 30%, with rural unemployment rates being even higher than that. This occurs despite the near complete absence of an unemployment insurance system and little labour market regulation that applies to rural labour markets. This paper examines how unemployment can persist without support from unemployment compensation. Analysing household surveys from 1993, 1995, and 1998, we find that the household formation response of the unemployed is the critical way in which the unemployed assure access to resources. In particular, unemployment delays the setting up of an individual household by young persons, in some cases by decades. It also leads to the dissolution of existing households and a return of constituent members to parents and other relatives and friends. Access to state transfers (in particular, noncontributory old age pensions) increases the likelihood of attracting unemployed persons to a household. Some unemployed do not benefit from this safety net, and the presence of unemployed members pulls many households supporting them into poverty. We also show that the household formation response draw some of the unemployed away from employment opportunities, and thus lowers their employment prospects.
dc.identifier0-77011-063-1
dc.identifierhttp://hdl.handle.net/11090/662
dc.identifier.ris TY - Working Paper DA - 2015-05-28 DB - OpenUCT DP - University of Cape Town KW - Unemployment KW - South Africa KW - Rural unemployment KW - Urban unemployment KW - Unemployment insurance KW - Labour market regulation KW - Household formation KW - State transfers KW - Pension KW - Social grants KW - Poverty KW - Employment opportunities KW - Employment LK - https://open.uct.ac.za PB - University of Cape Town PY - 2015 T1 - Surviving unemployment without state support: Unemployment and household formation in South Africa TI - Surviving unemployment without state support: Unemployment and household formation in South Africa UR - http://hdl.handle.net/11090/662 ER - en_ZA
dc.identifier.urihttp://hdl.handle.net/11090/662
dc.languageen
dc.publisherCSSR and SALDRU
dc.publisher.departmentSALDRUen_ZA
dc.publisher.facultyFaculty of Commerceen_ZA
dc.publisher.institutionUniversity of Cape Town
dc.relationCSSR/SALDRU Working Papers;129
dc.subjectUnemployment
dc.subjectSouth Africa
dc.subjectRural unemployment
dc.subjectUrban unemployment
dc.subjectUnemployment insurance
dc.subjectLabour market regulation
dc.subjectHousehold formation
dc.subjectState transfers
dc.subjectPension
dc.subjectSocial grants
dc.subjectPoverty
dc.subjectEmployment opportunities
dc.subjectEmployment
dc.titleSurviving unemployment without state support: Unemployment and household formation in South Africa
dc.typeWorking Paper
uct.type.publicationResearchen_ZA
uct.type.resourceWorking Paperen_ZA
Files
Collections