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Financial services and the informal economy
No full textThis paper examines the impact of formality of employment on the utilisation of financial services, using data from the October 2000 Income and Expenditure Survey and the September 2000 Labour Force Survey. The presence of an employed member in the household is seen to be important for the utilisation of both bank accounts and funeral insurance, even after controlling for income. Furthermore there are strong links between the nature of this employment and utilisation of financial services. Employees are more likely to utilise financial services than the self-employed. Among employees, the probability of utilising financial services increases with the degree of formality of employment. These effects are stronger for formal banking services than for funeral insurance which includes informal burial societies
The impact of parental death on school enrolment and achievement: Longitudinal evidence from South Africa
No full textWe analyse longitudinal data from a demographic surveillance area (DSA) in KwaZulu-Natal, to examine the impact of parental death on children's outcomes. We find significant differences in the impact of mothers' and fathers' deaths. The loss of a child's mother is a strong predictor of poor schooling outcomes. Maternal orphans are significantly less likely to be enrolled in school, and have completed significantly fewer years of schooling, conditional on age, than children whose mothers are alive. Less money is spent on their educations on average, conditional on enrolment. Moreover, children whose mothers have died appear to be at an educational disadvantage when compared to non-orphaned children with whom they live. We use the timing of mothers' deaths relative to children's educational shortfalls to argue that mothers' deaths have a causal effect on children's educations. The loss of a child's father is a significant predictor of household socioeconomic status. Children whose fathers have died live in significantly poorer households, measured on a number of dimensions. However, households in which fathers died were poor prior to fathers' deaths. The death of a father between waves of the survey has no significant effect on subsequent household economic status. While the loss of a father is correlated with poorer educational outcomes, this correlation arises because a father's death is a marker that the household is poor. Evidence from the South African 2001 Census suggests that the estimated effects of maternal deaths on children's school attendance and attainment in the Africa Centre DSA reflect the reality for orphans throughout South Africa.Analysis is based on data collected through the Africa Centre Demographic Information System. Authors are affiliated with the Population Studies Group of the Africa Centre for Health and Population Studies. We have benefited from the ACDIS field and data centre staff under the leadership of the principal investigator, Dr. Kobus Herbst. We thank Angus Deaton and Frances Lund for comments on an earlier draft. Case gratefully acknowledges funding from the MacArthur Foundation (“Research Network on Poverty and Inequality in Broader Perspective”) and the National Institute of Aging R01 AG20275-01
Income inequality after apartheid
No full textThis paper investigates changes in and patterns of income inequality in South Africa during the post-apartheid period 1994 to 2004. While findings show a rapidly growing high-income African population (a trend that began before 1994 and continued thereafter) as well as rising real wages for workers in formal employment, overall levels of income inequality have not been declining This is due to rising unemployment and a small informal sector that have therefore left unchanged South Africa's high level of income inequality. If anything, overall inequality has worsened. Inter-racial inequality has decreased while intra-racial inequality has increased. Opportunities have improved for some African people in South Africa, but not for all: a lack of human and social capital leaves many with little chance of rising out of poverty; AIDS-related mortality and morbidity are likely to exacerbate stratification and further increase inequality
Young People's Social Networks, Confidants and Issues of Reproductive Health
No full textThis qualitative micro study was conducted in the Metropole of Cape Town, the third largest metropole in South Africa during 2002. The study must be seen in relation to the Cape Area Panel Study (CAPS) that was conducted in June 2002. CAPS is planned as a longitudinal data collection project aimed at the youth in the Cape Metropole. The panel study broadly aims to supplement existing data sets like the Census, October Household Survey [OHS], Labour Force Survey [LFS] in particular with longitudinal and qualitative data addressing areas not necessarily done by national surveys. It anticipates uncovering determinants of schooling, unemployment and earnings of young adults and youth in this part of the country. Adolescent childbearing is common in South Africa as demonstrated by the 1998 South Africa Demographic and Health Survey, where by the age of 19 years, 30 percent of teenage females have had a child, 35 percent have been pregnant and the majority of teenage childbearing is outside of marriage. [Department of Health 1999] Given the high prevalence of pregnancy and unmarried childbearing among adolescent females, it becomes important to understand the degree to which young people themselves understand how pregnancy and childbearing in adolescence delay or disrupt other life course events such as school completion or entering into marriage or cohabitation. Drawing on focus group discussion data from teenagers in Cape Town on normatively appropriate sequences, we note the degree to which the actual ways teenage males and females move through adolescence depart from the normative sequences.This research was supported by a grant from the Mellon Programme on Demography at the University of Cape Town. We thank the Andrew W Mellon Foundation for its support. Permission for this work was granted by the Western Cape Education Department. The authors would also like to thank the young men and women from Hout Bay, Khayelitsha, Mitchell’s Plain and Wynberg, who agreed to participate in the
frank discussions that made this study possible. We also want to thank all the teachers [5 teachers from High Schools, a Church Minister and a lay minister] who made the focus group sessions possible
Unemployment and AIDS: The Social-Democratic Challenge for South Africa
No full textThere are two major economic and social security challenges facing South Africa: addressing large-scale unemployment and the AIDS pandemic. As of 2003, an estimated 14% of all South Africans were HIV-positive, with over a thousand people dying each day of AIDS. According to the government household and labour-force surveys conducted from the mid-1990s onwards, about a third of the labour force is without work (Nattrass, 2000a). This amounts to about 4.7 million people and it is, without question, a socio-economic crisis of major proportions. The life-chances and living-standards of entire households are compromised when working-age adults cannot find employment (Seekings, 2003b). Households burdened by AIDS are in an especially difficult position (Desmond et al 2000, Steinberg et al 2002a, 2002b; Booysen, 2002; Booysen et al, 2002). Addressing AIDS and unemployment poses major challenges for social solidarity in South Africa. Over the past decade, the labour-market and industrial-policy environment has benefited relatively high-productivity firms and sectors (Nattrass, 2001). Business thus had strong incentives to reduce dependence on unskilled labour, and once the price of highly active antiretroviral therapy (HAART) started to fall from 2001 onwards, to supply it, either directly or indirectly through medical aids, to their increasingly skilled workforce (Nattrass, 2003). Those without jobs had neither access to earned income nor life-prolonging medication
The 'Risk Gap', Its Determinants and Economic Implications
No full textDemography and economics are linked and it is not possible to look at either discipline in complete isolation from the other. The gap between the time of first sex and first marriage is of particular importance, as this is the time when a person is most vulnerable to infection with HIV/AIDS as well as unwanted pregnancies. This gap is thus referred to as the risk gap. Both these phenomena are extremely costly. The risk gap in South Africa is growing due to the duel impact of delayed marriages and sexual encounters which take place at an increasingly early age. There is a positive relationship between the provincial HIV/AIDS prevalence rate and the provincial risk gap. This suggests that by manipulating the risk gap, government may have a tool that could be used to affect the HIV/AIDS level in South Africa.I would like to express my thanks to my supervisor Dr Anne Bakilana for her help, direction and advice throughout the writing of this paper. I would also like to express my gratitude to SALDRU and the Melon
Foundation for their financial aid, which made my studies and this paper possible
An overview of the performance and potential of public works programmes in South Africa
No full textIn this paper simple models are used to estimate the impact and fiscal feasibility of 'expanded' public works programmes using the limited data available. The employment creation potential of a R1.2 billion investment in labour intensive construction over three-years is found to represent a maximum of 0.5% of unemployed workdays per annum. The cost to the fiscus of an expanded public works programme able to offer part time employment to a significant number of workers (3.2 million) is found to be between R17 and R28 billion per annum
Reservation Wages-Measurement and Determinants: Evidence from the KMP Survey
No full textThis paper investigates the difficulties in measuring reservation wages, models the determinants of reservation wages, and compares reservation wages with predicted wages. Data is drawn from the Khayelitsha/Mitchell's Plain (KMP) survey. Certain factors (e.g. education, labour market status, household income and duration of unemployment) are significant in explaining variation in reservation wages. Importantly, a person's position in the labour market is not as a result of his/her reservation wage. Rather, reservation wages are a function of his/her labour market status: while those in wage-employment report a reservation wage based more on perceived labour market value, those in unemployment report a reservation wage influenced strongly by subsistence requirements. This study concludes that voluntary unemployment does not exist in KMP, with people in general reporting reservation wages well below what they could expect to earn
Integration into the South African Core Economy: Household Level Covariates
No full textThe aim of this paper is to further improve the understanding of income generation among the formerly underprivileged and often impoverished majority of households in South Africa. This study uses household survey data for the analysis of households' integration into the South African core economy. The emerging picture of household income generation is one that disputes common perceptions of the multitude of means by which African households are assumed to generate their income. The majority of households rely to a large extent on one income source and one income earner. Verbal contextual information and descriptive statistics justify the estimation of separate multinomial logit models for urban and non-urban households with the probabilities for having either of five main income source categories as outcomes. Results from the regression analyses indicate that prominent covariates of low core-economy integration are earners who are female, either old or young earners of working-age, who have low levels of education. A non-urban household's location in either a former 'homeland' or in an agriculturally or commercially developed area yields disparate implications for the main income source probabilities. The study also finds associations between main income sources and households' demographic compositions which are compatible with findings in previous research on both private transfer behaviour and endogenous household formation in South Africa.The author notes that while any defects or shortcomings in this work are entirely his own responsibility, thanks goes to Arne Bigsten, Lennart Flood, Stefan Klasen, Murray Leibbrandt, Laura Poswell, Donald Storrie, and Ali Tasiran for valuable comments to previous versions of this work. The financial provision for this research by the Swedish International Development Cooperation Agency (Sida) is thankfully acknowledged. The author would also like to thank the Centre for Social Science Research at the University of Cape Town for hosting the author while conducting the research
for this work
Savings and Savers: An Analysis of Saving Behaviour among Cape Town's Poor
No full textThis paper analyses the characteristics of low-income savers in a working class residential area of Cape Town. It uses the Khayelitsha and Mitchell's Plain Survey that was conducted in 2000. The survey was done at both a household and individual level for all adults over 18 years old. These household and individual datasets were merged to form the dataset used in this study. There were 4984 respondents of which 2644 were adults .The KMPS data set is a good foundation for analysing the characteristics of savers in a low income area characterised by high unemployment and poverty