AN ANALYSIS ON THE ANTECEDENTS OF YOUNG EMPLOYEES’ EARNING POTENTIAL IN SOUTH AFRICA

Yıl 2020, , 152 - 171, 30.06.2020

Precious Mncayi Jacques De Jongh

https://doi.org/10.34109/ijefs.202012110

Öz

Concerns surrounding the outcomes of young people in the labour market have become a global phenomenon. None more so has this been evident than in South Africa. While finding employment seems highly unlikely for most, circumstances surrounding the outcomes of those who are employed have likewise raised alarms. Understanding what contributes to decent employment in this regard holds important relevance not only in promoting the wellbeing of the cohort, but also advancing the knowledge on the requirements to utilise their local development potential. The purpose of the study was therefore to identify the antecedents of young South African employees’ earning potential. A quantitative approach and cross-sectional research design were employed, where secondary data collected through the most recent national labour market dynamics survey was used. The sample consisted of 27 493 young employees between the ages of 15 and 34 years. Descriptive statistics, cross-tabulations and a linear regression were utilised for the analysis. Results of the study showed the earnings potential of young South Africans to be intertwined with an array of aspects. In this regard, the remuneration prospects of young people depend on race, sector of employment and trade union membership. Outcomes were also highly gendered biased, while the impact of labour market inequalities including the lack of social capital and geographical characteristics likewise seems to affect their earnings ability. Recommendations in advancing the cohort’s labour market outcomes must, therefore, include enhanced public-private partnership formation through mandatory apprenticeship programmes. This must be supported by the relaxation of labour market regulations and a strategic focus that seeks to advance both soft and technical skills.

Anahtar Kelimeler

Earnings, employees, youth, labour market, South Africa

Kaynakça

• Ahmed, T. (2016). Labour market outcome for formal vocational education and training in India: Safety net and beyond. IIMB Management Review, 28(1), 98-110.
• Amiti, M. & Cameron, L. (2007). Economic geography and wages. The Review of Economics and Statistics, 89(1) 15-29.
• Amiti, M. (2005). Location of vertically linked industries: Agglomeration versus comparative advantage. European Economic Review, 49(4), 809-832.
• Anand, R., Kothari, S. & Kumar, N. (2016). South Africa: Labour market dynamics and inequality. IMF Working Paper No. 16/137. Washington, D.C.: IMF.
• Arias, O. & Khamis, M. (2008). Comparative advantage, segmentation and informal earnings: A marginal treatment effects approach. IZA Discussion Papers No. 391. Bonn, Institute of Labour Economics.
• Atlonji, J.G. & Blank, R.M. (1999). Race and gender in the labour market. In O. Ashenfelter & D. Card (Ed.) Handbook of Labour Economics (pp. 3144 – 3259). Amsterdam: Elsevier Science B.V.
• Banerjee, A, Galiani, S, Levinsohn, J, Mclaren, Z & Woolard, I. (2008). Why has unemployment risen in the new South Africa? Economics of Transition, 16(4), 715–740.
• Bargain, O. & Kwenda, P. (2011). Earnings structures, informal employment and self-employment: new evidence from Brazil, Mexico and South Africa. Review of Income and Wealth, 57(1), S100-S122.
• Baskaya, Y. S. & T. Hulagu (2011). Informal-formal worker wage gap in turkey: Evidence from a semi-parametric approach. Central Bank of the Republic of Turkey Working Papers No.1115. Türkiye Cumhuriyet: TCMB.
• Becker, G. S. (1964). Human Capital: A Theoretical and Empirical Analysis, With Special Reference to Education. New York, NY: Columbia University Press.
• Beukes, R., Fransman, T., Murozvi, S. & Yu, D. (2017). Underemployment in South Africa. Development Southern Africa, 34(1), 33-55.
• Bhattarai, K. (2000). Determinants of wages and labour supply in the UK. Economie Internationale et de l’Entreprise Working Papers, No. 277. Nantes: Universite de Nantes.
• Bhattarai, K. (2017). Determinants of wages and labour supply in the UK. Chinese Business Review, 16(3), 126-140.
• Bhorat, H, Goga, S & van der Westhuizen, C (2012). Institutional wage effects: Revisiting unions and bargain council wage premia in South Africa. South African Journal of Economics 80(3), 400–414.
• Branson, N., De Lannoy, A. & Brynde, K. (2019). Review of Youth Labour Market Research. Cape Town: SALDRU, University of Cape Town.
• Bryson, A (2014). Union wage effects. IZA World of Labor, 2014(35), 1-10.
• Culliney, M. (2017). Escaping the rural pay penalty: a longitudinal analysis of rural/urban youth earnings in Britain. Work, Employment and Society, 31(3), 429- 446.
• Culpepper, L. (2009). Geographic pay differential practices. https://www.shrm.org /resourcesandtools/hrtopics/compensation/pages/geographicpay.aspx Accessed 07/20/2019.
• De Jongh, J.J. (2017). Youth Employment Barriers in The Emfuleni And Metsimaholo Local Municipal Areas. Masters dissertation. Vanderbijlpark: North-West University.
• De Lannoy, A., Graham, L., Patel, L. & Leibbrandt, M. (2018). What drives youth unemployment and what interventions help? A systematic overview of evidence and a theory of change. High-level overview report. Cape Town: REDI 3x3, University of Cape Town.
• Doeringer, P.B. & Piore, M.J. (1985). Internal Labor Markets and Manpower Analysis. Armonk, NY: ME Sharpe.
• Field, A. (2018). Discovering Statistics Using IBM SPSS Statistics. 5th edition. SAGE publications.
• Freeman, R.B. & Medoff, J.L. (1984). What do unions do. Industrial. & Labour. Relations Review, 38(1), 244-263.
• Gong, X. & A. van Soest (2002). Wage differentials and mobility in the urban labour market: A panel data analysis for Mexico. Labour Economics, 9(4), 513-529.
• Graham, L. & De Lannoy, A. (2016). Youth Unemployment: What Can We Do in The Short Run? Cape Town: Development Policy Research Unit, University of Cape Town.
• Graham, L. & Mlatsheni, C. (2015). Youth unemployment in South Africa: Understanding the challenge and working on solutions. In A. De Lannoy, S., Swartz, L. Lake & C. Smith (Eds.), South African Child Gauge 2015. Cape Town: Children’s Institute, University of Cape Town.
• Green, F. & Henseke, G. (2016). Should governments of OECD countries worry about graduate underemployment? Oxford Review of Economic Policy, 32(40), 514–537.
• Hair, J.F., Black, W.C., Babin, B.J. & Anderson, R.E. (2010). Multivariate Data Analysis: A Global Perspective. 7th Ed. New Jersey: Pearson Prentice Hall
• Hossain, K.A., Haque, A.M. & Haque, A.K. (2015). An analysis of the determinants of wage and salary differentials in Bangladesh. South Asia Economic Journal, 16(2), 295–308.
• Ingle, K., Mlatsheni, C. (2017). The extent of churn in the South African youth labour market: Evidence from NIDS 2008-2015. Working Paper Number 201. Cape Town: University of Cape Town.
• Isaac, J. (2018). Why are Australian wages lagging and what can be done about it? The Australian Economic Review, 51(2), 175–190.
• Kingdon, G., Sandefur, J. & Teal, F. (2006). Labour market flexibility, wages and incomes in sub-Saharan Africa in the 1990s. African Development Review 18(3), 392–427.
• Mankiw, G., Taylor, M., Campher, C. & Ncawdi, R. (2018). Macroeconomics. Cengage: London.
• Meyer, N. (2017). South Africa’s Youth Unemployment Dilemma: Whose Baby is it anyway? Journal of Economics and Behavioral Studies, 9(1), 56-68.
• Mincer, J. (1974). Schooling, Experience and Earnings. Massachusetts: National Bureau of Economic Research.
• Mlatsheni, C. (2014). Youth Unemployment and The Transition from School to Work in Cape Town. Doctoral thesis: Cape Town: University of Cape Town.
• Mlatsheni, C., & Ranchhod, V. (2017). Youth Labour Market Dynamics in South Africa: Evidence from NIDS 1-2-3. Cape Town: SALDRU, University of Cape Town.
• Moleke, P. (2010) The graduate labour market. In: M. Letseka, M. Cosser, M. Breier & M. Visser. (Eds.), Student Retention & Graduate Destination: Higher Education & Labour Market Access & Success. (pp. 87-95). Cape Town: HSRC Press.
• Nahm, D., Dobbie, M. & MacMillan, C. (2017) Union wage effects in Australia: An endogenous switching approach, Applied Economics, 49(39), 3927-3942.
• Nestiae, D. (2004). The determinants of wages in Croatia: Evidence from earnings regressions. In the 65th Conference of the Institute of Economics, ZAGREB Proceedings. Pages 131-162
• Ntlhlola, M, A., Kwenda, P. & Ntuli, M. (2019). A distributional analysis of union-wage effects in South Africa: Evidence from panel data, Development Southern Africa, 36(3), 309-328.
• Ntuli, M & Kwenda, P (2014). Labour unions and wage inequality among African men in South Africa. Development Southern Africa, 31(2), 322–346.
• Oluwajodu, F., Blaauw, D., Greyling, L. & Kleynhans, E.P.J (2015). Graduate unemployment in South Africa: Perspectives from the banking sector. SA Journal of Human Resource Management, 13(1), 656-664.
• Pratap, S. & E. Quintin (2006). Are labor markets segmented in Argentina? A semiparametric approach. European Economic Review, 50(1), 1817–1841.
• Pytliková, M. (2013). Reinvestigating the determinants of the gender wage gap: Evidence from a survey. Ostrava: Technical University of Ostrava.
• Ranchhod, V. (2013). Earnings volatility in South Africa. SALDRU Working Paper No. 121. Cape Town: SALDRU, University of Cape Town.
• Reynolds, M (2008). Labor Unions. The Concise Encyclopedia of Economics. http://www.econlib.org/library/Enc/LaborUnions.html Accessed 2019/07/02.
• Ryan, C. (2013). Field of Degree and Earnings by Selected Employment Characteristics: 2011. https://www.census.gov/prod/2012pubs/acsbr11-10.pdf Accessed 07/18/2019.
• Scherer, S. (2004). Stepping-stones or traps? The consequences of labour market entry positions on future careers in West Germany, Great Britain and Italy. Work, Employment and Society, 18(1), 369–394
• Schmid, G. (2010). Non-Standard Employment and Labour Force Participation: A Comparative View of the Recent Development in Europe. Bonn: Institute of Labor Economics.
• StatsSA (Statistics South Africa). (2019). Labour Market Dynamics in South Africa 2017: Metadata. Pretoria: Government Printer.
• Tanaka, Y. (2014). A Theory of Wage Determination: A Training Model with Heterogeneous Labour Approach. Ann Arbour, MI: Proquest LLC.
• Tansel, A. & Kan, E.O. (2012). The formal/informal employment earnings gap: Evidence from Turkey. IZA Discussion Paper No. 6556. Bonn, Institute of Labour Economics.
• Thurow, L. (1975). Generating inequality. Basic Book: New York.
• Van Der Berg, S., Burger, C. & Burger, R. et al. (2011). Low-quality education as a poverty trap. Economic Working Papers, 25/11. Stellenbosch: Stellenbosch University.