An investigation of employment outcomes in South African manufacturing
| dc.contributor.advisor | Black, Anthony | |
| dc.contributor.author | Mercer, Sean | |
| dc.date.accessioned | 2021-02-10T10:30:54Z | |
| dc.date.available | 2021-02-10T10:30:54Z | |
| dc.date.issued | 2020 | |
| dc.date.updated | 2021-02-10T10:30:31Z | |
| dc.description.abstract | The aim of this research paper is to investigate the employment outcomes in South African manufacturing between 1972 and 2016. The research employs a combination of qualitative and quantitative analysis in demonstrating how South Africa's manufacturing sector has become increasingly capital-intensive, with aggregate manufacturing employment falling by approximately 600 thousand jobs between 1982 – 2016. The investigation highlights the influence of industrial policy decisions in this outcome, creating a bias towards investment in capital-intensive manufacturing industries. This trend has continued post-1994, despite government's repeated commitment to job creation and strategic policy support for more labour-intensive industries. A further investigation of the manufacturing sector at a sub-industry level indicates that while capital-intensity has increased in capital and labour-intensive industries alike, the increase in aggregate manufacturing capital-intensity is due primarily to capital-intensive industries expanding their share of aggregate capital stock and output relative to labour-intensive industries. Consequently, South Africa's revealed comparative advantage lies, somewhat paradoxically, in capital-intensive production, contrasting the manufacturing sectors in similar comparator countries. To ensure a rigorous investigation of the aforementioned outcomes, the paper examines the common notion that South African real wages are too high to be competitive in labour-intensive production. The findings indicate that poor labour productivity is an equally important contributor to uncompetitive unit labour costs relative to competitor countries. As a means of addressing these challenges, utilizing a practical example, the paper proposes the use of special economic zones to create an environment from which labour-intensive production can thrive. It highlights the potential of targeted industrial policies, in a controlled environment to reduce the cost of labour whilst simultaneously improving productivity over time. Utilizing various instruments, for example wage subsidies, the example illustrates how such an approach is a cost-effective way of encouraging investment in labour-intensive industries, simultaneously offering a solution to more meaningful employment creation in South African manufacturing. | |
| dc.identifier.apacitation | Mercer, S. (2020). <i>An investigation of employment outcomes in South African manufacturing</i>. (). ,Faculty of Commerce ,School of Economics. Retrieved from http://hdl.handle.net/11427/32807 | en_ZA |
| dc.identifier.chicagocitation | Mercer, Sean. <i>"An investigation of employment outcomes in South African manufacturing."</i> ., ,Faculty of Commerce ,School of Economics, 2020. http://hdl.handle.net/11427/32807 | en_ZA |
| dc.identifier.citation | Mercer, S. 2020. An investigation of employment outcomes in South African manufacturing. . ,Faculty of Commerce ,School of Economics. http://hdl.handle.net/11427/32807 | en_ZA |
| dc.identifier.ris | TY - Master Thesis AU - Mercer, Sean AB - The aim of this research paper is to investigate the employment outcomes in South African manufacturing between 1972 and 2016. The research employs a combination of qualitative and quantitative analysis in demonstrating how South Africa's manufacturing sector has become increasingly capital-intensive, with aggregate manufacturing employment falling by approximately 600 thousand jobs between 1982 – 2016. The investigation highlights the influence of industrial policy decisions in this outcome, creating a bias towards investment in capital-intensive manufacturing industries. This trend has continued post-1994, despite government's repeated commitment to job creation and strategic policy support for more labour-intensive industries. A further investigation of the manufacturing sector at a sub-industry level indicates that while capital-intensity has increased in capital and labour-intensive industries alike, the increase in aggregate manufacturing capital-intensity is due primarily to capital-intensive industries expanding their share of aggregate capital stock and output relative to labour-intensive industries. Consequently, South Africa's revealed comparative advantage lies, somewhat paradoxically, in capital-intensive production, contrasting the manufacturing sectors in similar comparator countries. To ensure a rigorous investigation of the aforementioned outcomes, the paper examines the common notion that South African real wages are too high to be competitive in labour-intensive production. The findings indicate that poor labour productivity is an equally important contributor to uncompetitive unit labour costs relative to competitor countries. As a means of addressing these challenges, utilizing a practical example, the paper proposes the use of special economic zones to create an environment from which labour-intensive production can thrive. It highlights the potential of targeted industrial policies, in a controlled environment to reduce the cost of labour whilst simultaneously improving productivity over time. Utilizing various instruments, for example wage subsidies, the example illustrates how such an approach is a cost-effective way of encouraging investment in labour-intensive industries, simultaneously offering a solution to more meaningful employment creation in South African manufacturing. DA - 2020 DB - OpenUCT DP - University of Cape Town KW - economics LK - https://open.uct.ac.za PY - 2020 T1 - An investigation of employment outcomes in South African manufacturing TI - An investigation of employment outcomes in South African manufacturing UR - http://hdl.handle.net/11427/32807 ER - | en_ZA |
| dc.identifier.uri | http://hdl.handle.net/11427/32807 | |
| dc.identifier.vancouvercitation | Mercer S. An investigation of employment outcomes in South African manufacturing. []. ,Faculty of Commerce ,School of Economics, 2020 [cited yyyy month dd]. Available from: http://hdl.handle.net/11427/32807 | en_ZA |
| dc.language.rfc3066 | eng | |
| dc.publisher.department | School of Economics | |
| dc.publisher.faculty | Faculty of Commerce | |
| dc.subject | economics | |
| dc.title | An investigation of employment outcomes in South African manufacturing | |
| dc.type | Master Thesis | |
| dc.type.qualificationlevel | Masters | |
| dc.type.qualificationlevel | MCom |