Labor Market Reform Options to Boost Employment in South Africa

June 11, 2021

Preview Citation

Format: Chicago

Romain A Duval, Yi Ji, and Ippei Shibata. Labor Market Reform Options to Boost Employment in South Africa, (USA: International Monetary Fund, 2021) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Raising South Africa’s low employment rate to levels seen in emerging market or advanced economy peers could raise GDP per capita by 50 to 60 percent and reduce income inequality dramatically in the long term. By putting further strain on an already fragile labor market, Covid-19 has raised the urgency of action. This paper reviews labor market policy and other reform options to enhance South Africa’s job market performance, drawing from international evidence and new analysis. We find much scope for improving the design of key labor market institutions—including collective bargaining and employment protection legislation—and active labor market policies to improve job seekers’ prospects. These reforms should come hand-in-hand with others, such as in the areas of education or product market regulation, that may work pay. Labor market and other reforms would primarily benefit disadvantaged groups such as youth.

Subject: Economic sectors, Employment, Employment protection, Financial crises, Labor, Labor markets, Wages

Keywords: Africa, Employment, Employment protection, Labor market performance, Labor markets, Paper reviews labor market policy, Product market regulation, Reform option, Wages, Youth employment

Publication Details

Pages:

39
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2021/165
Stock No:

WPIEA2021165
ISBN:

9781513584478
ISSN:

1018-5941

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