The impact of the agricultural minimum wage and the role of enforcement in South Africa
type: CreativeWork
description: Since 1999 South Africa gradually developed a detailed minimum wage schedule covering eleven sectors of the economy. Labour market institutions were also created to enforce the new laws; the efficacy of which has hitherto remained unexamined. The legislated minimum wage in South Africa varies across, and within sectors. Mandated wages within a sector can differ depending upon occupation type, the number of hours worked, as well as geographic location. There is thus no single national minimum wage. Internationally, minimum wages are widely used as a policy tool to protect vulnerable workers from exploitation and help alleviate poverty. In South Africa the socioeconomic arguments supporting minimum wages are well established, that is, minimum wages aim to redistribute earnings to low paid workers, assist workers with weak bargaining power, and lift the working poor out of poverty. The economic effect that minimum wages have, on employment in particular, is a classic labour economics question which has attracted considerable attention in the international literature. However, as the two introductory quotes illustrate, there is some disagreement among economists as to the precise impact of minimum wages. More broadly there are those who question whether minimum wages are a welfare enhancing intervention at all. The recent introduction of minimum wage laws in South Africa makes comprehensive enquiry into such issues particularly pertinent for economists and policymakers. It is therefore surprising that few empirical studies have investigated the impact of these policies on the local labour market. In an effort to begin filling the gap this paper focuses on the agricultural sector in South Africa. The first component of this paper investigates and measures the aggregate impact of the Agricultural Sectoral Determination. Observing changes in farmworker earnings, contract coverage, employment, and the number hours worked per week, provides insight into the impact of the law…
abstract: Since 1999 South Africa gradually developed a detailed minimum wage schedule covering eleven sectors of the economy. Labour market institutions were also created to enforce the new laws; the efficacy of which has hitherto remained unexamined. The legislated minimum wage in South Africa varies across, and within sectors. Mandated wages within a sector can differ depending upon occupation type, the number of hours worked, as well as geographic location. There is thus no single national minimum wage. Internationally, minimum wages are widely used as a policy tool to protect vulnerable workers from exploitation and help alleviate poverty. In South Africa the socioeconomic arguments supporting minimum wages are well established, that is, minimum wages aim to redistribute earnings to low paid workers, assist workers with weak bargaining power, and lift the working poor out of poverty. The economic effect that minimum wages have, on employment in particular, is a classic labour economics question which has attracted considerable attention in the international literature. However, as the two introductory quotes illustrate, there is some disagreement among economists as to the precise impact of minimum wages. More broadly there are those who question whether minimum wages are a welfare enhancing intervention at all. The recent introduction of minimum wage laws in South Africa makes comprehensive enquiry into such issues particularly pertinent for economists and policymakers. It is therefore surprising that few empirical studies have investigated the impact of these policies on the local labour market. In an effort to begin filling the gap this paper focuses on the agricultural sector in South Africa. The first component of this paper investigates and measures the aggregate impact of the Agricultural Sectoral Determination. Observing changes in farmworker earnings, contract coverage, employment, and the number hours worked per week, provides insight into the impact of the law…
author: Stanwix, Benjamin
language: eng
date published: 2011
date modified: 2026-07-22T22:23:26Z
provider: University of Cape Town
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: School of Economics

PropertyValue
property ID: Handle
value: http://hdl.handle.net/11427/12450