PROSPECTS OF ENTREPRENEURSHIP TO THE CHALLENGE OF JOB CREATION IN SOUTH AFRICA

2012 ◽  
Vol 17 (04) ◽  
pp. 1250020 ◽  
Author(s):  
DARMA MAHADEA
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
New Ventures ◽  
Job Creation ◽  
Growth Effect ◽  
Formal Sector ◽  
Employment Creation ◽  
Formidable Challenge ◽  
The Government ◽  
Economic Growth Rates

Entrepreneurship is critical to job creation and economic growth. Unemployment in South Africa is presently at about 25 percent. The formal sector is unable to provide adequate employment opportunities for labor although the country registered positive economic growth rates over the past 17 years since the demise of apartheid. Some people manage to obtain employment in the informal sector. However, this sector also has been shedding labor recently. Although the government has responded with many initiatives to deal with employment creation, unemployment rates, especially among the youth, remain a formidable challenge. Entrepreneurship, through the creation of new ventures and expansion of business firms, can make a difference to absorb more people in the labor market. However, this depends on the level of entrepreneurial capacity and environment of the South African economy. This paper examines the problem of low employment economic growth performance over the post-apartheid period. By drawing on the Harrod-Domar model as a heuristic guide, and using regression analysis, the paper highlights the probable links between changes in economic growth and in employment. The results indicate the marginal employment growth effect is positive, the growth elasticity of employment is low over the 1994–2010 period and investment in relation to the country's desired growth in GDP is also found to be low. The paper identifies some constraints to employment creation against the entrepreneurial environmental conditions in South Africa and then examines how entrepreneurship can make a difference to employment creation.

scholarly journals The challenge of low employment economic growth in South Africa: 1994 -2008

2010 ◽  
Vol 13 (4) ◽  
pp. 391-406 ◽  
Author(s):  
Darma Mahadea ◽  
Richard Simson
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Time Horizon ◽  
Formal Sector ◽  
Critical Problem ◽  
Unemployment Rates ◽  
The Past ◽  
Trading Partners ◽  
Recent Developments ◽  
Economic Growth Rates

The formal sector in South Africa is unable to provide adequate employment for labour although the economy registered positive economic growth rates over the past 15 years since the demise of apartheid.  This is a critical problem, given the current recessionary climate and recent developments in the economies of our trading partners.  While government has responded with many initiatives to deal with employment creation, unemployment rates remain high.  This problem is examined by reviewing South Africa’s growth performance and links to employment and posits various alternative strategies.  The growth elasticity of employment is found to be rather low over the 1994-2008 period, and even over a longer time horizon the marginal growth employment effect is found to be rather weak.   

The Myth of Middle Class Moderation: African Lessons for South Africa

1988 ◽  
Vol 16 (2) ◽  
pp. 45-48
Author(s):  
Pauline H. Baker
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Middle Class ◽  
Empirical Research ◽  
Political Behavior ◽  
Economic Performance ◽  
Political Stability ◽  
Underlying Assumption ◽  
Coup D'etat ◽  
The Government

An underlying assumption that ocurs in both conventional wisdom and in many academic analyses of political behavior is the notion that a critical linkage exists between political change and economic performance. The assumption is that economic growth is either a precondition or a correlate of democracy and political stability. Little empirical research has been done to test the validity of this widely held assumption as it applies to multicultural societies. Moreover, in the African environment, the assumption seems to operate only in selected cases or in ways that defy categorization. Jerry Rawlings, for example, said he led his first coup d’etat in Ghana because the government was going to devalue the currency; he led his second coup, in part, because the next government was going to devalue; and, during his own tenure in office, he has presided over a 1000 percent devaluation.

scholarly journals Economic growth effect of private capital inflows: a structural VAR approach for Nigeria

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Friday Osemenshan Anetor
Keyword(s):  
Economic Growth ◽  
Forecast Error ◽  
Research Result ◽  
Structural Var ◽  
Capital Inflows ◽  
Growth Effect ◽  
Private Capital ◽  
Portfolio Investment ◽  
Content Type ◽  
The Government

Purpose The purpose of this paper is to examine the effect of shocks in the various components of private capital inflows on economic growth in Nigeria using quarterly data in the period 1986Q1–2016Q4. Design/methodology/approach The study employs the impulse response function and the forecast error variance decomposition of the structural vector autoregression (SVAR) model. Findings The research result shows that shocks in foreign direct investment (FDI) inflows and portfolio investment inflows have a positive and significant impact on economic growth in Nigeria. In addition, FDIs accounted for significant variation in the growth of the Nigerian economy followed by portfolio investments, while personal remittances exerted the least variation in growth. Practical implications The government should promote a favorable macroeconomic environment for existing and potential foreign investors to ensure the continued inflows of FDI and portfolio investment. Originality/value The novelty of this study lies in disaggregating private capital inflows and analyzing the effect of the shock of each component on the growth of the Nigerian economy using SVAR.

Investigating the non-linear Wagner’s hypothesis in South Africa

2017 ◽  
Vol 8 (4) ◽  
pp. 462-473 ◽  
Author(s):  
Temitope Lydia A. Leshoro
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Government Spending ◽  
Time Series Data ◽  
Series Data ◽  
Unique Contribution ◽  
Content Type ◽  
Non Linear ◽  
Regression Error ◽  
The Government

Purpose The commonly adopted view of the relationship between government spending and economic growth follows the Keynesian approach, in which government spending is considered to determine economic growth. However, there is another theory, which suggests that economic growth in fact determines government spending. This is Wagner’s hypothesis. The purpose of this paper is to investigate which of the two approaches applies to South Africa, and further observes the level of non-linearity between the two variables. Design/methodology/approach This study was carried out using quarterly time series data from 1980Q1 to 2015Q1. Granger causality technique was used to observe the direction of causality between the two variables, while regression error specification test (RESET) was employed to determine whether the variables exhibit linear or non-linear behaviour. This was followed by observing the threshold band, using two techniques, namely, sample splitting threshold regression and quadratic generalised method of moments. Findings The causality result shows that South Africa follows Wagner’s law, whereby government spending is determined by economic growth, supporting Odhiambo (2015). The RESET result shows that the variables depict a non-linear relationship, thus the government spending economic growth model is non-linear. It was found that if positive economic development is to be achieved, economic growth should preferably be kept within the −1.69 and 3.0 per cent band, and specifically above 1 per cent band. Originality/value The unique contribution of this study is that no previous study has attempted the non-linear government spending-economic growth nexus whether within the Keynesian or Wagner law for South Africa.

scholarly journals Analysis of the Impact of Fiscal Policy on Economic Growth in South Africa: VECM Approach

2018 ◽  
Vol 10 (2) ◽  
pp. 231
Author(s):  
Tshembhani Mackson HLONGWANE ◽  
Itumeleng Pleasure MONGALE ◽  
Lavisa TALA
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Fiscal Policy ◽  
Negative Impact ◽  
National Development ◽  
Real Gdp ◽  
Long Run ◽  
Fixed Capital Formation ◽  
The Government ◽  
The Impact

Fiscal policy ensures macroeconomic stability as a precondition for growth at the macro level. This study investigates the impact of fiscal policy on economic growth of South Africa from 1960 to 2014 through a Cointegrated Vector Autoregression approach. It seeks to contribute to the existing literature as well as in designing effective fiscal policy programmes which can propel economic performance. Theresults of the long run estimates revealed that government tax revenue has a positive and significant long run influence on economic growth, whereas the government gross fixed capital formation and budget deficit have a negative impact on real GDP. For that reason, the study recommends that some expansionary fiscal policy measures should be strengthened since they play a very important role in the economy so as to meet the government target of the National Development Plan Vision for 2030.

scholarly journals Public outlook on small and medium enterprises as a strategic tool for economic growth and job creation in South Africa

2015 ◽  
Vol 4 (4) ◽  
pp. 412-418 ◽  
Author(s):  
Lawrence Mpele Lekhanya
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Quantitative Research ◽  
Small And Medium Enterprises ◽  
Job Creation ◽  
Primary Data ◽  
Research Approach ◽  
Survival And Growth ◽  
Analyse Data ◽  
Medium Enterprises

In spite of the key role played by the Small and Medium enterprises in economic development, there has been little effort to look at what needs to be done to improve survival and growth of SMEs. There is still a general lack of in-depth understanding from policy makers and other relevant stakeholders of how SMEs can be used as a strategic tool for economic growth and job creation in South Africa. These misperceptions and misunderstand leads to continuous failure to SMEs survival and growth. This study seeks to address this research gap. The study investigates the public views on what needs to be done to grow South African economy through the development of SMEs. Quantitative research approach was used to collect and analyse data for the study. Primary data was collected from four (4) provinces of South Africa. 230 people participated in the study. Questionnaires were emailed to each respondent and follow-ups were made via telephone. It was found that many SMEs fail within five years of their existence due to the various reasons. The most critical of these were related to lack of access to finance, lack of management experience as well as human capital. Study further revealed that most the SMEs owners/managers do not have business management related skills but rather they are just ordinary entrepreneurs.

COMMUNITY PRO-CONTRA PROJECT FOR THE PRESENCE OF THE OMNIBUS LAW BILL IN LEGAL SOCIOLOGY PERSPECTIVE

2020 ◽  
Vol 4 (2) ◽  
pp. 168
Author(s):  
Deni Umbara ◽  
Jum Hermanto ◽  
Franky Ariyadi
Keyword(s):  
Economic Growth ◽  
Indigenous Peoples ◽  
Job Creation ◽  
Minimum Wages ◽  
The Other ◽  
Foreign Investors ◽  
The People ◽  
The Government ◽  
Legal Sociology

The Omnibus Law was first echoed during the inauguration of the President of theRepublic of Indonesia to be precise, on October 20, 2019. Omnibus Law is a legalconcept that will simplify a regulation. All the considerations are causedby too manyrules that have stagnated the economic growth experienced by this nation. With themany regulations, the president felt the need to take steps forward to minimize theseregulations. Acode was created that could back up all rules, namely the presence of theOmnibus Law Bill, which later the bill became a law called the Omnibus Law.Peoplewho reject and feel uneasy about the presence of the Omnibus Law Bill think that thisbill will only prioritize outside investment, making it a red carpet for foreign investors,the investment will only be enjoyed by the elite and a handful of people, which does notlead to job creation which will have an impact on improving people's welfare, makingworkers like production machines, loss of minimum wages, reducing overtime workinghours, and many other articles that castrate their own people. With the presence of thisbill, it will make this nation even more backward from democracy. The government andthe DPR should have drafted this law to protect and voice the voices of the peopleaffected by the regulations, not the other way around. Therefore, the people who are against it assess that the presence of this bill will legitimize investments that destroy the environment, ignore the assets of the people and indigenous peoples. The drafting ofthis bill was carried out behind closed doors without the participation of civil societyand recycled unconstitutional articles of centralization of authority that hurt the spiritof reform.

Developing an E-Commerce Strategy for Success in Brunei

2022 ◽  
pp. 319-340
Author(s):  
Nurul Hamizah Md.Saleh ◽  
Heru Susanto
Keyword(s):  
Economic Growth ◽  
Southeast Asia ◽  
Job Creation ◽  
Self Employment ◽  
The People ◽  
Internet Penetration ◽  
The Government

The people in Brunei are digitally connected every day. Brunei recorded itself with the highest internet penetration (95%) in Southeast Asia. However, the local e-commerce industry seems to be still at infancy stage although the idea of e-commerce is not new here. Bruneians shop at global e-commerce sites, purchase from local social sellers, and commission online personal shoppers. But why are local e-commerce brands struggling although they are also providing similar business? Thus, this chapter aims to find out the ways to improve and strive in the Brunei market – What is the problem? What is missing? What can be done? The researcher aims to dissect the root issues and provide recommendations as the e-commerce strategy. The motivation for this research is in the effort to support the government continuous initiatives to curb unemployment in this country; e-commerce industry as the enabler for self-employment, entrepreneurship, and job creation contributes to the economic growth.

scholarly journals Informal Labour Markets As A Solution For Unemployment In South Africa – A Case Study Of Car Guards In Bloemfontein

2003 ◽  
Vol 1 (2) ◽  
Author(s):  
P. F. Blaauw ◽  
L. J. Bothma
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Low Income ◽  
Skill Development ◽  
Formal Sector ◽  
Informal Labour ◽  
The Unemployed ◽  
Formal And Informal Sectors ◽  
Harsh Conditions

The car guard industry in South Africa evolved out of the plight of the unemployed. Very little research has been done on the industry in South Africa. The first objective of this article is to address the lack of research and the second is to determine whether the car guard industry can provide a solution to the problem of unemployment. Car guards involved in this study were found to be generally low skilled, earning low income and working under harsh conditions for long hours. The majority of them held formal sector employment before becoming unemployed. Car guarding is not a solution to the plight of the unemployed. Training and skill development supplemented by accelerated economic growth are vital to bridge the gap between the formal and informal sectors. OpsommingDie motorwag-industrie in Suid Afrika het onstaan uit die lot van die massa werkloses in die land. Weinig navorsing is al oor die industrie gedoen. Die doelwit van die artikel is eerstens om die gebrek aan navorsing aan te vul en tweedens om te bepaal of die motorwagindustrie ’n oplossing vir die probleem van werkloosheid kan bied. Motorwagte in die studie is oor die algemeen laag geskoold, swak besoldig en werksaam vir lang ure onder moeilike omstandighede. Die meeste het ’n werk in die formele sektor van die ekonomie gehad voordat hulle werkloos geword het. Om ’n motorwag te wees kan nooit ’n oplossing vir werkloosheid wees nie. Opleiding en die ontwikkeling van noodsaaklike vaardighede teen ’n agtergrond van versnelde ekonomiese groei, is uiters noodsaaklik om die gaping tussen die informele en formele sektor te oorbrug.

scholarly journals The Effect of Exchange Rate Movements and Economic Growth on Job Creation

2017 ◽  
Vol 62 (2) ◽  
pp. 20-41
Author(s):  
Chama Chipeta ◽  
Daniel Francois Meyer ◽  
Paul-Francois Muzindutsi
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Exchange Rate ◽  
Real Exchange Rate ◽  
Job Creation ◽  
Vector Autoregressive ◽  
The Real ◽  
Long Run ◽  
Exchange Rate Shocks ◽  
The Impact

Abstract Job creation is at the centre of economic development and remains a source of sustenance for social and human relations. The creation of a job-enabling economic environment is imperative in promoting social and economic cohesiveness in the macro and microeconomic environment. Any shocks to the economy, particularly those of exchange rate shocks and changes in economic growth, may negatively affect the labour market and job creation. This study made use of quarterly observations, from the first quarter of 1995 to the fourth quarter of 2015, to investigate the effect of the real exchange rate and economic growth on South Africa’s employment status. South Africa, a developing country, was selected as a case study due to its high unemployment rate that is still increasing. The Vector Autoregressive (VAR) model and multivariate co-integration techniques were used in assessing the impact and responsiveness of employment to the real exchange rate and real economic growth in South Africa. Findings of this study revealed that employment responds positively to economic growth and negatively to the real exchange rate in the long-run. The short-run displays a positive relationship between real economic growth and employment, while the relationship between employment and the real exchange rate is also negative. However, the effect of economic growth in creating jobs is not significant enough in stimulating job creation in South Africa, as indicated by results in variance decomposition. Movements in the exchange rate exerted a significant short and long-run negative effect on employment dynamics; implying that a depreciation of the rand against the U.S. dollar is associated with decrease in overall employment. Exchange rate stability is thus important for economic growth and job creation in South Africa. The study provided further recommendations on promoting job creation in South Africa and other developing countries.

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