Handson Banda

Impact of Economic Growth on Unemployment in South Africa: Impact of Economic Growth on Unemployment Handson Banda

South Africa is one of the African countries that is endowed with a lot of resources, both human and minerals. However due to activities such as increase in corruption, gross mismanagement and adverse policies of various governments, these resources have not been optimally utilised. One of the most pressing problems facing the South African economy is unemployment, which has been erratic over the past few years. This study examined the impact of economic growth on unemployment, using quarterly time series data for South Africa for the period 1994 to 2012. The study resulted in the following policy recommendation: South African government should re-direct its spending towards activities that directly and indirectly promote creation of employment and decent jobs; a conducive environment and flexible labour market policies or legislations without impediments to employment creation should be created; and lastly government should prioritise industries that promote labour intensive. All this will help in absorbing large pools of the unemployed population thereby reducing unemployment in South Africa.