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The Causes And Effects Of Unemployment In South Africa

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The basic definition of unemployment according to Stein (1967:4-5) is to be used to refer to persons without jobs who are currently are or were seeking work and were available for work, plus those on layoff or waiting to start new jobs. Those people are classified as unemployed. Even though the unemployment rate in South Africa states that about 26% of the labor force is currently unemployed, it has not always been this way as it appears that at the time of democratic transition unemployment was significantly lower than it is today (Banerjee, Galiani, Levinsohn, McLaren and Woolard, 2008:715-740).
In this study we attempt to determine the causes and impacts of the high unemployment rate in South Africa and how the South African government is looking to lower its unemployment rate by examining and comparing the economic policies implemented by other countries who have significantly improved their unemployment rate. In Heckman and Borjas (1980:247-283) it is stated that, the greater the number of previous spells of unemployment and the longer their duration, the more likely is the event that an individual will again be unemployed at a point in time.

Literature Review

Causes and factors contributing to unemployment in South Africa

Unemployment is one of the greatest challenges and one of the most pressing socio-economic issues affecting a majority of the population. There are various causes of unemployment in South Africa but according to Rodrik (2008:769-797), the main

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