Employment Scenarios to 2014 & 2024 in the Context of a Global Meltdown

by ALTMAN, M, 2009
Research Report. Centre for Poverty Employment and Growth, Human Sciences Research Council

The 2007 Human Sciences Research Council employment scenarios are updated in this paper, taking into account the possible impact of the global economic crisis on employment and poverty. Altman puts forward three employment scenarios, projecting economic growth rates averaging 2.5% (L-shaped recovery), 3.3% (U-shaped recovery) and 4.5% (V-shaped recovery) between 2004 and 2014. They all assume the existing policy environment, albeit with different levels of success in implementation. All three scenarios show a very large shortfall in meeting the objective of halving unemployment, unless massive public works programmes are put in place. For example, in Scenario 2, with an average of 3.3% growth, approximately half of all new jobs over the decade (2.4 million) would be created by public works at a cost of approximately R58 billion in 2014. Since this is unlikely to transpire, the paper re-evaluated Scenario 2 to see how special interventions might still enable the unemployment target to be achieved. These interventions focus on creating or saving jobs in the market, stimulating jobs in the non-profit sector, creating jobs in the public sector, expanding public special employment programmes, and providing more full-time learning opportunities for qualifying school leavers. If the proposed package were implemented, approximately 1.2 million public works jobs would be needed at a cost of R28 billion in 2014, or about 4% of the budget in that year. This is about five times the size of the current programme, but significantly less than without special interventions. These proposals require urgent evaluation, and if practical, urgent implementation.