Unravelling the impact of the global financial crisis on the South African labour market

The global financial crisis of 2008-2009 has deeply impacted South Africa due to its financial and trade links with the rest of the world. As a consequence, Africa’s largest economy fell into recession half way through 2008. This paper makes an important contribution to better understanding the impact of the crisis in South Africa, which also has implications for other emerging economies. In particular, the findings highlight the need to look at changes to all labour force states, not just unemployment, and to analyse the role of socioeconomic characteristics in driving vulnerability in the labour market using micro-data. Though the economy has now registered positive growth in the third quarter of 2009, South African policymakers are still confronted with the challenge of formulating and implementing policies that encourage job search and self-employment among the lowskilled. Over the longer term, education and training for the low-skilled and an appropriate industrial policy should remain key priorities for the government of South Africa.

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