Trade, Technology and Employment in South Africa

South Africa has become increasingly integrated with the global economy since the early 1990s and particularly after the ending of apartheid. However this has not been associated with increased employment and high levels of unemployment are a major economic and social problem. The paper considers the impact of trade and technological change on both the level and skill composition of manufacturing employment. First a Chenery-type decomposition analysis of employment change is carried out and then labour demand functions are estimated econometrically. Both trade and technology are found to have had a negative impact on employment but these are only partial explanations of the low rate of employment growth.