Determinants of unemployment and earnings in South Africa

Abstract

South Africa is one of the countries with chronic high unemployment rate. The unemployment rate has consistently been above 24% for a considerable period of time. It is important for policy and decision makers to know the type of persons who are unemployed, and underemployed in order to come up with the right intervention. The purpose of this study was to find and describe the determinants of unemployment, underemployment, and earnings in South Africa. In order to realize the objectives of the study, secondary data from 2012 Quarterly Labour Force Survey was used. Statistics South Africa collects labour market related information from persons between the age of 15 and 64. The data have information on status of unemployment, underemployment and earnings and other related to variables. Logistic regression was applied on the data and it was found that age, gender, population group, marital status, level of education, and province were significant determinants of unemployment in South Africa. Gender, population group, sector, marital status and contract duration were found to be significantly associated with time-related underemployment. Generalised linear model was applied on the data and it was found that gender, population group, marital status, level of education contract duration, geographical location, and sector were the determinants of earnings.