Editing Economy of South Africa (section)

==Labour market==
South Africa has an extreme and persistent high unemployment rate of over 30%, which interacts with other socioeconomic problems such as: inadequate education, poor health and high levels of crime.<ref>{{cite web |title=Economic Survey of South Africa 2010 |url=http://www.oecd.org/document/21/0,3343,en_2649_33733_45637781_1_1_1_1,00.html |url-status=dead |archive-url=https://web.archive.org/web/20100720213622/http://www.oecd.org/document/21/0,3343,en_2649_33733_45637781_1_1_1_1,00.html |archive-date=2010-07-20 |access-date=11 June 2015 |website=Organisation for Economic Co-operation and Development}}</ref> The poorest have limited access to economic opportunities and basic services.<ref name=wbcb/>  According to a 2013 Goldman Sachs report, that number increases to 35% when including people who have given up looking for work.<ref name="cnn.com"/> A quarter of South Africans live on less than US$1.25 a day.<ref>{{cite web|url=http://hdr.undp.org/en/media/HDI_2008_EN_Tables.pdf%7ctitle=HDI%7cpublisher=UNDP|title=- Human Development Reports|access-date=11 June 2015}}</ref>

South Africa's mass unemployment dates back to the 1970s, and continued to rise throughout the 1980s and 1990s.<ref name=lametal>{{cite web|title=Education and Youth Unemployment in South Africa|url=http://www.saldru.uct.ac.za/home/index.php?/component/option,com_docman/Itemid,32/gid,250/task,doc_download/|publisher=Southern Africa Labour and Development Research Unit|author1=David Lam|author2=[[Murray Leibbrandt]]|author3=Cecil Mlatsheni|archive-url=https://www.webcitation.org/65yEonSxJ?url=http://www.saldru.uct.ac.za/home/index.php?%2Fcomponent%2Foption%2Ccom_docman%2FItemid%2C32%2Fgid%2C250%2Ftask%2Cdoc_download%2F|archive-date=6 March 2012|page=2|year=2008}}</ref> Unemployment has increased substantially since the [[African National Congress]] came to power in 1994, increasing from 15.6% in 1995 to 30.3% in 2001.<ref name=uninsa>{{cite journal |first1=Abhijit |last1=Banerjee |first2=Sebastian |last2=Galiani |first3=Jim |last3=Levinsohn |first4=Zoë |last4=McLaren |first5=Ingrid |last5=Woolard |title=Why has unemployment risen in the New South Africa? |journal=Economics of Transition |volume=16 |issue=4 |year=2008 |pages=715–740 |doi=10.1111/j.1468-0351.2008.00340.x |citeseerx=10.1.1.514.4342 |s2cid=33437467}}</ref> In the second quarter of 2010, the jobless rate increased to 25.3%, and the number of people with work fell by 61,000 to 12,700,000. The biggest decline in employment was recorded in the manufacturing industry, which lost 53,000 jobs. Agriculture lost 32,000 jobs, employment in the construction industry fell by 15,000.<ref>{{cite web|url=https://www.bloomberg.com/news/2010-07-27/south-african-jobless-rate-rises-to-25-3-undermining-economic-recovery.html|title=South Africa Sheds Jobs, Denting Economic Recovery|author=Nasreen Seria|date=27 July 2010|work=Bloomberg.com|access-date=11 June 2015}}</ref> In the third quarter of 2010, 29.80% of blacks were recorded as unemployed, compared with 22.30% of Coloureds, 8.60% of Asians and 5.10% of Whites.<ref>[https://web.archive.org/web/20230609210448/http://www.statssa.gov.za/timeseriesdata/pxweb2006/Dialog/varval.asp?ma=Key_indicator_time_series&ti=Economic+Indicators+for+2009-2010+by+year%2Ckey+indicator+and+month&path=../Database/South%20Africa/Key%20Indicators/&lang=1 Statistics South Africa – Economic Indicators for 2009–2010 by Year, Key Indicators and month] </ref>

The official unemployment rate, though very high by international standards, understates its magnitude because it includes only adults who are actively looking for work. Therefore, excluding those who have given up looking for employment.<ref name=cde-fresh>{{cite web|title=A Fresh Look at Unemployment|url=http://www.cde.org.za/attachment_view.php?aa_id=397|publisher=Centre for Development and Enterprise|archive-url=https://www.webcitation.org/65yFcwa32?url=http://www.cde.org.za/attachment_view.php?aa_id=397|archive-date=6 March 2012|page=2|date=July 2011}}</ref> Only 41% of the population of working age have any kind of job (formal or informal).<ref name="cde-fresh" /> This rate is 30% points lower than that of China, and about 25% lower than that of Brazil or Indonesia.<ref name="cde-fresh" /> The relatively generous social grants reduces the political cost of unemployment.<ref name="ecopuzzle">{{cite web |last=Rodrik |first=Dani |title=Understanding South Africa's Economic Puzzles |url=http://www.hks.harvard.edu/fs/drodrik/Research%20papers/Understanding%20South%20Africa.pdf |publisher=John F. Kennedy School of Government |archive-url=https://web.archive.org/web/20120312112729/http://www.hks.harvard.edu/fs/drodrik/Research%20papers/Understanding%20South%20Africa.pdf |archive-date=12 March 2012 |page=11 |date=September 2006}}</ref> There is some evidence that households view paid employment and social grants as substitutes at the margin: households that lose a pension-eligible member subsequently report increased labour force participation.<ref name="ecopuzzle" />

The unemployment problem is characterised by its lengthy duration. In the mid-1990s, nearly two-thirds of unemployed people had never worked for a salary.<ref name="lametal" /> The 2005 Labour Force Survey found that 40% of unemployed individuals have been unemployed for more than three years, while 59% had never had a job at all.<ref name="lametal" /> The unemployment rate has fuelled crime, inequality and social unrest. The [[Late-2000s recession|global economic downturn]] made the problem worse, wiping out more than one million jobs. In September 2010, over one-third of South Africa's workforce were out of work, and so were more than half of blacks aged 15–34, three times the level than Whites.<ref name="nyt0910">{{cite news |url=https://www.nytimes.com/2010/09/27/world/africa/27safrica.html |title=Wage Laws Squeeze South Africa's Poor – NYTimes.com |newspaper=The New York Times |date=27 September 2010 |last1=Dugger |first1=Celia W.}}</ref>

Some experts contend that higher wages negotiated by politically powerful [[Trade unions in South Africa|trade unions]] have suppressed job growth.<ref name="nyt0910"/> According to a study by [[Dani Rodrik]], the shrinkage of the non-mineral [[tradable sector]] since the early-1990s and the weakness of the export-oriented manufacturing were more to blame for the low level of employment.<ref name="Rodrik">{{cite web|url=http://www.hks.harvard.edu/fs/drodrik/Research%20papers/Understanding%20South%20Africa.pdf|title=Understanding South Africa|access-date=5 September 2011|archive-url=https://web.archive.org/web/20120312112729/http://www.hks.harvard.edu/fs/drodrik/Research%20papers/Understanding%20South%20Africa.pdf|archive-date=12 March 2012}}</ref>

===Knowledge===
There has been a large degree of [[brain drain|human capital flight]] from South Africa in recent years.<ref name=ndulu>Human Capital Flight: Stratification, Globalization, and the Challenges to Tertiary Education in Africa; ''Benno J. Ndulu''; JHEA/RESA Vol. 2, No. 1, 2004, pp. 57–91</ref><ref name="mig_study">{{cite web|url=http://www.ilo.int/public/english/protection/migrant/download/imp/imp52e.pdf|title=Labour migration|access-date=11 June 2015|archive-date=16 June 2012|archive-url=https://web.archive.org/web/20120616165604/http://www.ilo.int/public/english/protection/migrant/download/imp/imp52e.pdf}}</ref> South Africa's Bureau of Statistics estimates that between 1 million and 1.6&nbsp;million people in skilled, professional, and managerial occupations have emigrated overseas between 1994 and 2004 and that, for every emigrant, 10 unskilled people lose their jobs.<ref name="ndulu"/> There are a range of causes cited for the migration of skilled South Africans.

In mid-1998, the Southern African Migration Project (SAMP) undertook a study to examine and assess the range of factors that contribute to skilled South Africans' desire to leave the country: over two-thirds of the sample said that they had given the idea of emigration some thought while 38% said they had given it a "great deal of thought".

Among the reasons cited for wishing to leave the country was the declining quality of life and high levels of crime. Furthermore, the government's [[Affirmative action#South Africa|affirmative action]] policy was identified as another factor influencing the emigration of skilled White South Africans. The results of the survey indicate that skilled Whites are strongly opposed to this policy and the arguments advanced in support of it, due to the negative impact it has had on South Africa.<ref name="mig_study" />

However, flight of human capital in South Africa should not be attributed solely to regional factors. For example, the demand for skilled labourers in the UK, US, Canada, New Zealand, and Australia has led to active recruitment programs by those countries in South Africa. These countries accounted for 75% (by volume) of recent skilled emigration with the UK receiving approximately half of annual skilled South African emigration from 1990 to 1996.<ref name="mig_study" /> It has been suggested that the role of domestic socio-political variables may be negligible.<ref name="mig_study" /> The health sector has been hit particularly hard.<ref>[http://www.equinetafrica.org/bibl/docs/healthpersonnel.pdf Health Personnel in Southern Africa: Confronting maldistribution and brain drain] {{webarchive|url=https://web.archive.org/web/20110430024959/http://www.equinetafrica.org/bibl/docs/healthpersonnel.pdf |date=30 April 2011}}</ref>

A widespread skills drain in South Africa and in the developing world in general is generally considered to be a cause for concern.<ref>{{cite journal|url=http://jae.oxfordjournals.org/cgi/content/abstract/13/suppl_2/ii15|archive-url=https://web.archive.org/web/20060927143525/http://jae.oxfordjournals.org/cgi/content/abstract/13/suppl_2/ii15|archive-date=27 September 2006|title=Africa's Exodus: Capital Flight and the Brain Drain as Portfolio Decisions|author=Paul Collier|journal=Journal of African Economies |date=2004 |volume=13 |pages=ii15–ii54 |doi=10.1093/jae/ejh042 |access-date=11 June 2015}}</ref>

For the medical sector, the loss of returns from investment for all doctors emigrating is $1.41bn for South Africa. The benefit to destination countries is huge: $2.7bn for the United Kingdom alone.<ref>Mills EJ et coll.: ''The financial cost of doctors emigrating from sub-Saharan Africa: human capital analysis''. British Medical Journal 2011.343.</ref>

In a case of [[reverse brain drain]] a net 359,000 high-skilled South Africans have returned to South Africa from foreign work assignments over a five-year period from 2008 to 2013. This was catalysed by the [[2008 financial crisis]] and perceptions of higher quality of life in South Africa relative to the countries from which they first emigrated to.  It is estimated that around 37% of those returning are professionals such as lawyers, doctors, engineers and accountants.<ref name="bdlive1">{{cite web |url=http://www.bdlive.co.za/national/labour/2014/01/14/expertise-flows-back-into-sa-as-brain-drain-is-reversed |title=Expertise flows back into SA as brain drain is reversed |publisher=Business Day |date=14 January 2014 |access-date=14 January 2014 |author=Hedley, Nick |archive-date=18 January 2014 |archive-url=https://web.archive.org/web/20140118081039/http://www.bdlive.co.za/national/labour/2014/01/14/expertise-flows-back-into-sa-as-brain-drain-is-reversed |url-status=dead}}</ref>

===Immigration===
{{See also|Immigration to South Africa|Xenophobia in South Africa}}
Refugees from poorer neighbouring countries include many immigrants from the Democratic Republic of the Congo, Mozambique, Zimbabwe, Malawi and others, representing a large portion of the [[informal sector]].

With high unemployment levels amongst poorer South Africans, xenophobia is prevalent and many South Africans feel resentful of immigrants who are seen to be depriving the native population of jobs, a feeling which has been given credibility by the fact that many South African employers have employed migrants from other countries for lower pay than South African citizens, especially in the construction, tourism, agriculture and [[domestic service]] industries. Illegal immigrants are also heavily involved in informal trading.<ref>{{cite web |url=http://www.iss.co.za/pubs/ASR/5No4/StrategigPerspectives.html |title=African Security Review Vol&nbsp;5 No&nbsp;4, 1996: Strategic Perspectives on Illegal Immigration into South Africa |archive-url=https://web.archive.org/web/20051019134404/http://www.iss.co.za/Pubs/ASR/5No4/StrategigPerspectives.html |archive-date=19 October 2005}}</ref> However, many immigrants to South Africa continue to live in poor conditions, and the South African immigration policy has become increasingly restrictive since 1994.<ref>{{cite web|url=http://www.queensu.ca/samp/sampresources/samppublications/policyseries/policy20.htm|title=Queens College: The Brain Gain: Skilled Migrants and Immigration Policy in Post-Apartheid South Africa|archive-url=https://web.archive.org/web/20051125214008/http://www.queensu.ca/samp/sampresources/samppublications/policyseries/policy20.htm|archive-date=25 November 2005}}</ref>

===Trade unions===
{{main|Trade unions in South Africa}}
[[2007 South African public servants' strike|Since 2007]] the South African unions representing public sector workers recurrently went on strike, demanding pay rises significantly above inflation, in a practice that some experts argue is suppressing job growth, harming millions of South Africans who are out of a job.<ref name="nyt0910"/>

In August and September 2010, South African unions organised a crippling four-week national strike involving 1.3&nbsp;million public sector workers, demanding an 8.6% wage increase. The strike ended after the government had raised its 5.2% wage increase to 7.5%. The deal swelled state spending by about 1%.<ref name="guard-strike">{{cite web|url=https://www.theguardian.com/world/2010/sep/06/south-africa-strike-suspended|title=South African unions suspend public sector strike|author=David Smith|work=the Guardian|date=6 September 2010 |access-date=11 June 2015}}</ref>

Protesters sought to block hospitals, and South African media have reported numerous acts of violence against health and education staff who insisted on going to work. Volunteers and army medics were called in to help at hospitals, and some patients were moved to private medical facilities.<ref name="guard-strike"/>

There is a persistent wage differential between unionised and non-unionised workers in South Africa, suggesting that unions are keeping wages higher for their members, thereby posing additional challenges to the unemployment problem.<ref name=uninsa/>

In July 2014, amidst a national strike by 220,000 metalworkers, [[General Motors]] temporarily shut down its vehicle assembly plant, frustrating its plans to build 50,000 cars a year in the country. "The ongoing labour disruptions are harming the South African economy and are affecting the country's image around the globe," the company said in a statement at the time.<ref name="GMsouthafrica">{{cite news|title=South Africa arm of General Motors hit by wage strike shuts plant|url=http://www.southafricanews.net/index.php/sid/223524973/scat/371b1b8643d479c1/ht/South-Africa-arm-of-General-Motors-hit-by-wage-strike-shuts-plant|access-date=5 July 2014|publisher=South Africa News.Net|archive-url=https://web.archive.org/web/20140714213434/http://www.southafricanews.net/index.php/sid/223524973/scat/371b1b8643d479c1/ht/South-Africa-arm-of-General-Motors-hit-by-wage-strike-shuts-plant|archive-date=14 July 2014}}</ref>

===Black Economic Empowerment===
The end of apartheid in 1994 left behind a skewed racial economic hierarchy that placed minority whites at the top. Since then, the African National Congress government created the [[Black Economic Empowerment]] (BEE) policy, designed to increase the participation of blacks, Coloreds, and Indians in the economy.

However, BEE has faced criticism for not doing enough to accomplish this goal and only benefiting a small number of people to a great extent. This was acknowledged in 2010 by Deputy President [[Kgalema Motlanthe]], at the first meeting of the BEE Advisory Council, when he said, "The story of black economic empowerment in the last 15 years has been a story dominated by a few individuals benefiting a lot." A 2010 report from the [[OECD]] concluded that the "relative improvement in poverty levels," since the end of apartheid, has actually been driven by social assistance grants and not the labour market.<ref>{{cite web|url=http://www.afrika.no/Detailed/19324.html|title=South Africa: Inequality not so black and white|access-date=11 June 2015|archive-url=https://web.archive.org/web/20151208174506/http://www.afrika.no/Detailed/19324.html|archive-date=8 December 2015}}</ref>

As of 2014, roughly ten percent of the Top 100 companies on the Johannesburg Stock Exchange were directly held by black investors through Black Economic Empowerment schemes.  Black Economic Empowerment policies have been credited with creating a class of Black South Africans with a level of wealth on the same order of magnitude as very rich White South Africans.<ref name="JeffreyGreg" />{{rp|2}}

Black Economic Empowerment—its purpose the "economic empowerment of all black people, including women, workers, youth, people with disabilities and people living in rural areas"—requires the Minister of Trade and Industry to develop and publish Codes of Good Practice, aimed at setting guidelines for the process of BEE in the whole economy.<ref name=crise-labour>{{cite web |title=Affirmative action in South Africa: an empirical assessment of the impact on labour market outcomes |url=http://www.crise.ox.ac.uk/pubs/workingpaper76.pdf |publisher=Centre for Research on Inequality, Human Security and Ethnicity |author1=Rulof Burger |author2=Rachel Jafta |archive-url=https://wayback.archive-it.org/all/20110401052454/http://www.crise.ox.ac.uk/pubs/workingpaper76.pdf |archive-date=1 April 2011 |page=7 |date=March 2010 |access-date=7 March 2012}}</ref> A [[QSE Scorecard|scorecard]] is used by the department to measure compliance with the BEE requirements, and is used for public procurement, public-private partnerships, sale of state-owned enterprises, when licenses are applied for, and for any other relevant economic activity.<ref name=crise-labour/>

The government's Black Economic Empowerment policies have drawn criticism from the Development Bank of Southern Africa for focusing "almost exclusively on promoting individual ownership by black people (which) does little to address broader economic disparities, though the rich may become more diverse." The System has also been criticised for placing lesser educated people in more important positions in the workplace and their failure to perform to the standards required has had an immense impact on the economy.

Another criticism also includes that the system goes against the constitution's preaching of equality by having preference over people, not on merit, but for their skin colour and is considered the opposite of what many people fought for during the Apartheid era.<ref>Neva Makgetla, [http://www.businessday.co.za/articles/Content.aspx?id=105049 Inequality on scale found in SA bites like acid], Business Day, 31 March 2010</ref> Official [[affirmative action]] policies have seen a rise in black economic wealth and an emerging black middle class.<ref>{{cite web|url=http://mg.co.za/article/2006-01-15-black-middle-class-boosts-car-sales-in-south-africa |title=Black middle class boosts car sales in South Africa – Business – Mail & Guardian Online |publisher=Mg.co.za |date=15 January 2006 |access-date=30 October 2011}}</ref>

An increasing number of black candidates who are supposed to be beneficiaries of affirmative action are dissociating themselves from it, largely because of the perception that the appointments are not based on merit.<ref name=transfo-booklet>{{cite web|title=Transformation Booklet |url=http://www.nedbankgroup.co.za/pdfs/transformationBooklet/transformationChapter04.pdf |publisher=Nedbank Group |archive-url=https://web.archive.org/web/20130603041522/http://www.nedbankgroup.co.za/pdfs/transformationBooklet/transformationChapter04.pdf |archive-date=3 June 2013 |page=77}}</ref>  The policy has also been criticised for having a negative impact on employment levels as it is viewed as being more of an additional burden for employees than as a transformative agent for the unemployed.<ref name="JeffreyGreg" />{{rp|2}}  Particularity in an economy where a major cause of inequality has been a growing disparity of income within the majority black population divided along lines of employment.<ref name="JeffreyGreg" />{{rp|12}}

=== Gender Equality ===
South Africans in general, regardless of race, hold what would be considered "traditional" stances on gender roles for men and women. The majority of the workforce is composed of males, while the majority of women do not participate.<ref>{{Cite web|url=https://data.worldbank.org/indicator/SL.TLF.ACTI.FE.ZS|title=Labor force participation rate, female (% of female population ages 15–64) (modeled ILO estimate)|website=data.worldbank.org|language=en-us|access-date=2017-12-09}}</ref> This viewpoint on males as "breadwinners" is very much in line with traditional African values across the continent. Additionally, females face a problem in terms of earnings, with 77% of women earning the same as their male counterparts.<ref>{{Cite web|url=https://mg.co.za/article/2015-05-04-south-africa-falling-short-in-gender-equality-standards|title=South Africa falling short in gender equality standards|date=4 May 2015 |access-date=2017-12-09}}</ref> However, more women are becoming part of the agricultural workforce (55%) as of 2012, marking a move towards modernisation for women's participation in the economy.<ref>{{Cite web|url=http://www.statssa.gov.za/?cat=25|title=Social welfare {{!}} Statistics South Africa|last=Africa|first=Statistics South|website=statssa.gov.za|language=en-US|access-date=2017-12-09}}</ref>

South African legislation is strongly geared to promoting gender equality in the workplace. This is characterised by several comprehensive government programs and organisations that provide resources and services to females, both adult and adolescent. Such initiatives include the Employment Equity Act, No. 55 of 1988 (aimed at promoting women's participation in mainly private sector jobs).<ref>{{Cite web|url=https://www.cbeinternational.org/resources/article/other/status-gender-equality-south-africa|title=The Status of Gender Equality in South Africa|website=CBE International|access-date=2017-12-09}}</ref> UNFPA South Africa is one such promoter of these policies and programs.<ref>{{Cite web|url=http://southafrica.unfpa.org/en/topics/gender-equality-3|title=UNFPA South Africa {{!}} Gender Equality|website=southafrica.unfpa.org|language=en|access-date=2017-12-09|archive-date=9 December 2017|archive-url=https://web.archive.org/web/20171209153524/http://southafrica.unfpa.org/en/topics/gender-equality-3}}</ref> Internally, the South African government has founded the Commission for Gender Equality.<ref>{{Cite news|url=http://theconversation.com/south-africas-social-welfare-system-faces-deepening-challenges-55962|title=South Africa's social welfare system faces deepening challenges|last=Patel|first=Leila|work=The Conversation|access-date=2017-12-09|language=en}}</ref> The commissions main focus is on securing adequate education and job training for women who are disenfranchised or otherwise at a disadvantage when attempting to enter the workforce.

Not uncommon in Africa, gender equality seems to be a very cogent problem in the South African workforce. According to Bain & Company, around 31% of companies have no form of female leadership, either in management or executive positions.<ref>{{Cite web|url=http://www.bain.com/publications/articles/gender-disparity-in-south-africa.aspx|title=Gender (Dis)parity in South Africa|date=24 May 2017 |access-date=2017-12-09}}</ref> 22% of board directors are women, however, only 7% were designated as "executives", lower than the global average of 12%.<ref>{{Cite news|url=https://northglennews.co.za/115437/stats-show-gender-inequality-power-positions-sa/|title=Stats show gender inequality power positions in SA {{!}} Northglen News|date=2017-08-29|work=Northglen News|access-date=2017-12-09|language=en-US}}</ref> Additionally, the eNPE (Employee Net Promoter Score) for women is a net negative (- 4) as compared to men (8), according to a survey conducted of 1000 participants.<ref>{{Cite news|url=https://www.one.org/africa/policy/status-of-women-and-girls-in-south-africa/|title=Join the fight against extreme poverty|date=2015-08-26|work=ONE|access-date=2017-12-09|language=en-US|archive-date=9 December 2017|archive-url=https://web.archive.org/web/20171209152423/https://www.one.org/africa/policy/status-of-women-and-girls-in-south-africa/}}</ref> This indicated a low level of actual economic promotion for women, despite public and international initiative towards the contrary.