Employment and skills in South African Exports

by VAN SEVENTER, D.E.N, 2006
Research Report. Centre for Poverty Employment and Growth, Human Sciences Research Council

Van Seventer reports on the labour absorption of South Africa’s exports, using a simple configuration based on a first-generation social accounting matrix (SAM). It compares the labour absorption of exports with that of domestic demand, and also discusses labour absorption by destination market. A distinction is made between full backward linkages and those where supply constraints are considered in the primary sectors. The paper also considers marginal versus average demand for labour responses to domestic and foreign demand injections. It finds that on average, exports require more low-skilled labour than does domestic demand, but if supply constraints are introduced and only marginal increases are considered, domestic demand appears to be more labour-intensive. In terms of destination markets, the paper broadly confirms findings from the mid-1990s that South African exports to developed countries use more low-skilled labour, while exports to developing markets use more high-skilled labour.