Examining employment discrimination in South Africa, 1997–2016

This study examines employment discrimination by race and gender in 1997–2016 by employing a sample that represents the labour force (excluding informal sector workers, agricultural workers, domestic workers, self-employed and employers) aged between 15 and 65 years. Probit models are conducted to estimate labour force participation, employment and occupational attainment likelihoods. This is followed by the Oaxaca–Blinder decomposition, and the results indicate that the unexplained component of the white–African employment probability gap reveals a downward trend in absolute terms in 2002–2014, but in relative terms it still accounts for about 50% of the gap in 2016. The unexplained component is most dominant in the male–female employment gap decomposition. While these results suggest that employment discrimination (unexplained component) against Africans and females remains serious, the improvement of education and skills level of the workseekers (explained component) from the previously disadvantaged groups remain crucial to improve their employment prospects.     

Labour Market Adjustment to Indonesia's Economic Crisis: Context,Trends and Implications

This paper focuses on labour market adjustment during the economic crisis of 1997–98. It shows how labour processes help explain better outcomes for the poor than were initially predicted. The Indonesian experience is viewed in a framework that contrasts two extreme models: a Keynesian world of rigid real wages, and a neoclassical situation of flexible adjustment to economic shocks. It was found that the Indonesian case is more consistent with the neoclassical than the Keynesian model, despite the tendency for greater government intervention in labour markets before the crisis. The paper also finds that the large change in relative prices from the exchange rate depreciation had a smaller effect than expected on employment structure. These conclusions are discussed in the context of major changes in labour markets prior to the economic crisis.     

Labour Market Trends and Structures in ASEAN and the East Asian NIEs

The paper reviews the literature on labour markets in the region with special emphasis on the impact of economic growth and structural change on employment and wages. It deals with labour supply trends, employment creation outside agriculture (especially export orientated industrialization and new high-tech industries), labour absorption in agriculture, wage differentials and the functioning of rural and urban labour markets.
The creation of efficient and equitable labour market institutions and labour market flexibility have emerged as dominant issues in the NIEs. In the ASEAN-4, because of concentration of employment in low productivity and low wage jobs and underutilization of labour, the rate of modern sector labour absorption remains the major policy concern.     

The changing fortunes of an aristocracy? Determinants of wages and conditions of employment in Kenya

This article examines the functioning of the labour market in the modern sector in Kenya and, in particular, considers the determinants of wages and other conditions of employment. An analysis of negotiated wages from collective agreements signed during 1974–75 suggests that measures of an ‘ability to pay’ characteristic of industries with limited competition in the product market and realizing above-average labour productivity are the best predictors of inter-industry wage differences. Locational and ownership variables are also found to be significant. Size of labour force is only significant for clerical wage rates. Four case studies suggest superior conditions of employment are positively associated with higher than average wages.     

Labour markets, welfare, and the personal scope of employment law

The issues which confront those concerned with employment law,about the types of workers to whom employment laws apply, arehighly relevant to the subject of labour markets and welfare.The formulation and application of the personal categories ofemployment law is or involves a welfare allocation, often seenas a trade-off between welfare and efficiency. This articledescribe the basic legal framework for determining the personalscope of employment law in the UK, considers some recent adaptationsto that framework, engages in comparison with some continentalEuropean legal systems, examines empirical evidence about theworking of the personal categories of employment law, describesthe debate within the ILO about employment status and 'contractlabour', canvasses some ideas about the growth of complex workrelationships, and concludes by assessing a remaining task offurther refinement of theory in this area.     

PRODUCTIVITY AND FIRM DYNAMICS: CREATIVE DESTRUCTION IN INDONESIAN MANUFACTURING, 1994–2000

This paper examines the entry and exit, and the labour productivity, of Indonesian manufacturing firms with 20 workers or more, using a firm-level panel dataset constructed for the years 1994–2000. Overall change in manufacturing labour productivity reached 27.2%—an average growth of 3.5% per annum—between 1994 and 2000, a period that includes the 1997–98 Asian financial crisis, which hit Indonesia hard. Vibrant firm dynamics characterised this period, in which about 10% of manufacturing enterprises were renewed in any one year. By 2000, one-third of all enterprises in existence in 1994 had closed, but the number of enterprises that closed was lower than the number that entered and survived up to the year 2000. The replacement of exiting firms with newly entering firms contributed significantly to increases in overall labour productivity. Regulatory reform in support of this process should lead to gains in productive employment for Indonesian workers.     

Setting It Right: Employment Protection,Labour Reallocation and Productivity

This paper provides a critical review of the recent empirical evidence on the links between regulations affecting the hiring and firing of workers, labour reallocation and productivity growth. It also reviews how workers affected by labour mobility fare and discusses policy options to support them. The upshot is that stringent employment protection has a sizeable negative effect on labour market flows and, through this channel, hinders productivity growth. At the same time, the evidence also shows that while greater labour market reallocation benefits many workers through higher real wages and better careers, some displaced workers lose out via longer unemployment durations and/or lower real wages in post-displacement jobs. In this context, reforms of employment protection should be considered as part of a comprehensive package that also includes an adequate safety net for the unemployed and effective re-employment services.     

Effect of Participation of Foreign Migrant Workers in Labour Market on Native Workers: Evidence Based on Change Noticed in College Premium in Taiwan ROC

Using Manpower Utilization Survey data for 14 years from 1999 to 2012, we applied the DDDD (Differences–in–differences–in–differences–in–differences) estimation method to check if rising presence of foreign migrant workers in Taiwan’s domestic labour market had any impact on employment opportunities and wages earned by native Taiwanese workers over time. We used the data capturing the effect of college premium (viz., the additional cost to be borne for getting admission into college) paid by the natives on domestic wage rate during this period. College premium is an indicator of demand and supply for educated labour and we intend to see if the premium has grown with time when influx of foreign migrant workers has grown too. From the results, two interesting phenomena caught our attention. First, labour policy adopted by the Government in Taiwan has played an important role in increasing the influx of foreign workers into domestic labour market, which resulted in significant change in college premium paid by the natives. And, this effect lasted even when instances of strikes and reported cases of labour disputes were relatively higher. Second, the effect of the policy has been varying across genders as our data shows that policy on employment of foreign workers has affected job opportunities of native men workers more than it affected job opportunities of their female counterpart.     

The impact of female employment on male salaries and careers: evidence from the English banking industry, 1890–1941

The late nineteenth‐ and early twentieth‐century British labour market experienced an influx of female clerical workers. Employers argued that female employment increased opportunities for men to advance; however, most male clerks regarded this expansion of the labour supply as a threat to their pay and status. This article examines the effects of female employment on male clerks using data from Williams Deacon's Bank covering a period 25 years prior to and 25 years subsequent to the initial employment of women. It is shown that, within position, women were substitutes for younger men, but not for senior men. In addition, the employment of women in routine positions allowed the bank to expand its branch network, creating new higher‐level positions, which were almost always filled by men.     

Informal employment and its effect on the income distribution in urban China

This paper discusses the issue of informal employment and its effect on the income distribution in China using datasets from the China Urban Labour Surveys of 2005 and 2010. Based on a new definition of informal employment, we estimated the proportion of informal employment relative to total non-agricultural employment in urban China and found it to be 49.7% in 2005 and 40.3% in 2010. Meanwhile, our study illustrated that informal employees' earnings were 67% that of formal employees, and this large earnings gap raised the Gini coefficient to 0.42 in 2005. The Blinder–Oaxaca decomposition result shows that the earnings gap explains more than half of the overall personal income inequality in urban China. These results indicate that informal employment has a significant effect on the income distribution in urban China. Consequently, regulating the labour market, eliminating job discriminations and legislating the informal employment should be considered as alternative means of reducing inequality in China.     

Labour hoarding in a disequilibrium model of the Dutch labour market

Summary This paper presents a method to integrate labour hoarding into a disequilibrium model of the labour market. Disequilibrium indicators for the labour market that include labour hoarding are constructed. These indicators, being important determinants of policy multipliers with respect to employment, are found to be less volatile than the corresponding disequilibrium indicators for the goods market which are available from business surveys. The lower volatility reflects the role of labour hoarding as a buffer between actual and efficient employment levels. Our results indicate that labour hoarding in Dutch enterprises ranges from a minimum of 0.5 per cent of employment in early 1985 to a maximum of 7.0 per cent in 1975. Furthermore, the paper pays special attention to the modelling of mismatch unemployment and to the simulation results of an empirical disequilibrium macromodel of the Dutch economy.The authors thank M.M.G. Fase and two anonymous referees for their useful comments.     

Distribution of income, technology and employment: An analysis of the industrial sectors of Ecuador, Peru and Venezuela

The increasingly popular strategy which postulates that a redistribution of income can automatically produce a higher level of employment and in turn, a better distribution of income, is discussed in this paper with special reference to the industrial sector. On the basis of data from Ecuador, Perú and Venezuela and utilizing a Leontieff type of model disaggregated by technological strata, the author concludes that the redistribution of income does not significantly affect employment in the industrial sector, since the two fundamental assumptions on which the positive results are expected are of doubtful validity. On one hand, the structure of consumption of industrial goods is inelastic to changes in income distribution and on the other, the production of wage goods does not necessarily imply the use of more labour intensive techniques.Given the need to improve the distribution of income, the author maintains that for such redistribution to be used to promote employment creation, special attention should be given to the direction of consumption of those benefited with the redistribution and to the channelling of the additional demand towards those establishments which use more labour intensive techniques.     

Is there a trade-off between the employment and wages of unskilled African South Africans?

The possible trade-off between employment and wages has characterised most of South Africa’s labour market debates, particularly with regards to decent wages versus unemployment. In this article we explore the relationship between labour market earnings and the level of employment among African birth cohorts using labour force data from 1997 to 2011. We find that the association between an increase in the proportion of unskilled employed in a birth cohort and earnings is mediated by the sector of employment. While some sectors exhibit the expected negative association, there is a robust positive relationship between the first two quartiles of the earnings distribution within birth cohorts and the proportion of the birth cohort who are employed in unskilled occupations in the manufacturing and trade sectors. Because a range of market forces determine this relationship, further research is needed to unpack the reasons for such varied outcomes in order to better inform the debates on labour market interventions like the proposed National Minimum Wage and to appreciate the potential impact of such policy interventions on wages and employment.     

Affiliates and parent employment through foreign direct investment: a study case of substitutability or complementarity

How does outward foreign direct investment (FDI) affect employment of multinationals in the home country? Does the impact of outward investment differ among manufacturing and service sectors? Using data on Italian MNEs, this paper examines the impact of Italian outward FDI on local employment between 1998 and 2006. In particular, we investigate the relationship existing between employment in the parent company and employment in foreign affiliates by distinguishing according to host-country location and sector of activity. The results suggest that the effects of Italian outward FDI on domestic employment differ according to the sector and the country of destination. In the manufacturing sector, a weak but significant relationship of labour substitutability is found for Italian MNEs producing low-technology products in foreign affiliates localized in high-wage countries. On the other hand, a significant North–south complementarity relationship in labour demands appears in the High and Medium-high- technology sectors. In the service sector, we find strong complementarity between employment in the parent firm and employment in foreign affiliates: in particular, this regards Italian MNEs producing knowledge-intensive services both in Western affiliates and CEEC locations. These results are robust when we control for endogeneity of output and parent wages.     

对发展中国家的贸易与美国制造业的就业变动

本文利用1997～2006年美国制造业的面板数据,从静态和动态的角度实证检验了美国制造业与发展中国家的进、出口贸易对美国制造业就业总量的影响。估计结果表明,考虑进、出口贸易对技术创新的驱动作用以后,进、出口贸易对就业的影响与理论预期存在不一致性,进口贸易不仅没有通过替代国内生产而减少劳动密集制造部门对劳动力的需求,反而促进了该部门的就业增长;出口贸易也没有通过产出扩大效应而增加劳动密集制造部门对劳动力的需求,出口贸易对就业的促进效应仅仅体现在技术密集制造部门。由于美国劳动力市场中存在价格效应、规模效应和劳动力需求的趋势效应,与发展中国家的进、出口贸易对美国制造业就业的影响呈现明显的滞后性和动态调整特征。     

Labour Market Flexibility,Wages and Incomes in Sub‐Saharan Africa in the 1990s

Abstract: This paper provides an overview of how African labour markets have performed in the 1990s. It is argued that the failure of African labour markets to create good paying jobs has resulted in excess labour supply in the form of either open unemployment or a growing self‐employment sector. One explanation for this outcome is a lack of labour market ‘flexibility’ keeping formal sector wages above their equilibrium level and restricting job creation. We identify three attributes of labour market flexibility. First, whether real wages decline over time; secondly, the tendency for wages to adjust in the face of unemployment; and thirdly, the extent of wage differentials between sectors and/or firms of various size. Recent research shows that real wages in Africa during the 1990s may have been more downwardly flexible than previously thought and have been surprisingly responsive to unemployment rates, yet large wage differentials between formal and informal sector firms remain. This third sense of the term ‘inflexibility’ can explain a common factor across diverse African economies — the high income divide between those working in large firms and those not. Those working in the thriving self‐employment sector in Ghana have something in common with the unemployed in South Africa — both have very low income opportunities relative to those in large firms.     

Synergies in Labour Market Institutions: the Nonlinear Effect of Minimum Wages on Youth Employment

Empirical evidence on the effect of minimum wages on youth employment is inconclusive, with studies pointing to negative, positive or insignificant effects. In trying to explain some of the conflicting evidence, this research paper examines synergies of minimum wages with other labour market institutions using an unbalanced panel dataset of 19 OECD countries over 1985–2013. Institutions that enforce labour market rigidity, such as unemployment benefits and union density, are found to exacerbate the negative effect of minimum wages on youth employment, while government expenditure on training programmes for the unemployed dampen it. This finding of significant synergy effects indicates that panel data models which omit interactive terms between minimum wages and institutions might be misspecified. In addition, the analysis suggests that the negative effect of minimum wages is most severe in rigid labour markets with high unemployment benefits and union density. Therefore, policymakers need to consider the full spectrum of institutions they face before adjusting minimum wages.     

Adjustment,employment characteristics and intra-industry trade

Adjustment, Employment Characteristics and Intra-Industry Trade. — In this paper we use data on individual workers to investigate a number of dimensions of adjustment and relate these to trade. Specifically, we estimate the relative incidence of changes in workers’ employment status with regard to sector, firm, occupation and region. We relate the incidence of adjustment to a range of labour market characteristics and indicators of trade exposure. Our findings are not consistent with the notion that there is a systematic relationship between the type of trade expansion (inter- or intra-industry) and the type of employment adjustment (within or between industry adjustment) or that there is less labour market adjustment associated with intra- than inter-industry trade.     

Trade, capital mobility, and the German labour market

Trade, Capital Mobility, and the German Labour Market. — This paper sets up three structural variants of a general equilibrium model of a small open economy with three sectors (exportables, importables, non-tradables) and three factors (internationally mobile capital and immobile skilled and unskilled labour) in order to analyse the employment and wage effects of globalisation shocks. The model is numerically implemented for West Germany in 1980 on the base of input-output tables and employment data from a random sample of social security accounts. Overall this study indicates that the globalisation process does not have strong effects on unemployment and/or the wage differential in West Germany.     

产业集群与劳动力扩张机制研究——以东部地区为例

我国东部地区的产业集群在经济发展中的作用日益突出,因此本文以产业集群和劳动力就业结构理论为基础,着眼于产业集群对劳动力就业的影响,分析不同的产业集群程度与劳动力就业扩张的相关关系,基于分析提出促进我国劳动力扩张的政策。