Wage Determination in South Africa: What Do We Know?

by ALTMAN, M., 2006
Transformation: Critical Perspectives on Southern Africa , 60 , 2006, pp. 58-89

Wages play an important role in the broader economy from both efficiency and equity perspectives. This article considers the state of knowledge on wage determination in South Africa. It asks the following questions: Is wage setting appropriate for South Africa’s development needs? Are wages determined in alignment with employment and growth needs to achieve full employment? Do they underpin incomes (for labour replacement)? Are they responsive to industrial competitiveness requirements? Are wages set within a competitive framework? What constrains competition in the labour market? How important are racial and gender discrimination? What impact do high skill wage increases have on economic growth? What impact would competition have?What are the roles of institutions such as unions and bargaining councils, and of minimum wages, on efficiency and equity?