Increasing the labour Intensity of South Africa’s Economy

On the 13th of June, I participated in a Roundtable discussion at the Centre for Development and Enterprise in Johannesburg under the theme “Increasing the labour intensity of South Africa’s economy”.

We had a number of great speakers covering a wide range of issues within the South African labour market environment. In the morning session (which I participated in), Professors Haroon Bhorat and Nicoli Nattrass of the University of Cape Town and Andrew Donaldson made a contribution under the question “Has policy made South Africa less labour intensive than it could have been?”

Meanwhile, Professors Jeremy Seekings and Anthony Black of the University of Cape Town, Gilad Isaacs of Wits Business School and I explored sectoral issues. The question we had to answer came down to: Why are sectors that use the most unskilled labour doing so badly in creating employment?

In an attempt to answer the question, I reflected on the South African agricultural labour market in the context of changing farm structures. Here are some of the key points I made in the closing remarks:

Can the National Development Plan’s agricultural employment targets (create close to a million jobs by 2030) be met?

  • Yes (to some extent). International experience shows that the agricultural sector can play an important role in absorbing labour and increasing labour participation.
  •  This is especially the case when taking into account the fact there is vast untapped potential land in Kwa-Zulu Natal, the Eastern Cape and Limpopo provinces.
  • The key subsector to focus on is horticulture (it is labour-intensive), and there is also a growing demand for horticultural products in the global market.
  • Overall — upskilling the current agricultural labour force to align with changing technological environment, increasing investment, research and development, and financial support (to developing farmers) are key to improving employment in the sector.

I have skipped a lot of important detail which is included in the presentation. You can access my full presentation here.


Follow me on Twitter (@WandileSihlobo). E-mail: wandile@agbiz.co.za

Author: Wandile Sihlobo

Wandile Sihlobo is an agricultural economist and head of agribusiness research at the Agricultural Business Chamber (Agbiz) in South Africa. He is a columnist for Business Day and Farmers Weekly magazine. Sihlobo is a member of the South African Agricultural Economics Association. He has previously served as an economist at Grain South Africa. He holds a Master of Science degree in Agricultural Economics from Stellenbosch University.

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