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Citation Information

Type Working Paper - DPRU Working Paper 201601
Title Investigating the feasibility of a national minimum wage for South Africa
Author(s)
Issue 01
Publication (Day/Month/Year) 2016
Page numbers 1-197
URL http://www.dpru.uct.ac.za/sites/default/files/image_tool/images/36/Publications/Working_Papers/DPRU​WP201601.pdf
Abstract
This report is divided into four main sections. The first section examines and summarises the international literature on minimum wages, with a specific focus on the effect of minimum wages on employment. We go on to examine the limited literature on South Africa and provide an overview of the current minimum wage systems in the country. The second section presents quantitative data on the South African labour market, looking specifically at working poverty, minimum wage coverage, the evolution of legislated wages in the SDs, and the current wage distribution. The third section explores how a NMW could impact on employment levels, wage poverty, and wage inequality across a range of possible scenarios. This exercise relies on a macroeconomic model to estimate employment effects and a microsimulation to examine the impact on household poverty and inequality levels. The fourth section focuses on implementation and enforcement. Here we review the experience of several other countries and draw a set of key lessons for NMW structure and implementation. This includes issues of coverage and possible exclusions, the level of the NMW, phase-in periods, timeframes, and enforcement regimes. The second part of this section then presents comprehensive data and information on enforcement and compliance in South Africa, and discusses institutional arrangements that could aid the efficient implementation and enforcement of a NMW.

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DPRU. "Investigating the feasibility of a national minimum wage for South Africa." DPRU Working Paper 201601 , no. 01 (2016).
Copyright DataFirst, University of Cape Town