Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/107971 
Year of Publication: 
2014
Series/Report no.: 
WIDER Working Paper No. 2014/130
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
This paper examines the changing nature of occupational labour-market trends in South Africa and the resulting impact on wages. We observe high levels of demand for skilled labour that have intensified a trend already established before 1994. Over the period 2001-12 employment within the primary sectors collapsed, employment in the manufacturing sector did not increase, while employment in the tertiary sectors such as financial services and community services grew. High- and medium-skilled occupations such as managers, professionals, service and sales workers have seen significant growth while the number of low-skilled workers, and the proportion of medium-skilled workers in the primary and secondary sectors of the economy have declined. In addition, an analysis of occupation demand using a Katz-Murphy decomposition model further shows that within-sector shifts outweigh between-sector shifts in explaining changes in relative labour demand. Increasing demand for skilled labour has also fed into and changed the structure of wages, and therefore wage inequality. We follow the work by Firpo et al. (2011) in an attempt to explore the way in which the returns to certain tasks (rather than occupations) have changed over time. This approach emphasizes the influence of structural factors such as technology and trade, in the presence of increasingly routinized tasks and offshoring, on wages. We run quantile regressions which suggest that, when controlling for age/experience, race and education, jobs which involve automated or routine tasks and those without any face-to-face component (largely lower- to medium-skilled jobs) have seen declining wage levels over time.
Subjects: 
skills
employment
South Africa
wages
occupations
JEL: 
E24
J21
J24
O14
O55
Persistent Identifier of the first edition: 
ISBN: 
978-92-9230-851-3
Document Type: 
Working Paper

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