Bell, Trevor : Unemployment in South Africa

One consequence of this is that by 1983 the percentage unemployment rates
in Canada (12.5). the Netherlandslands (12.91, the United Kingdom ( 13.5 ),
Belgium (14.1) and Spain (1 7,3) do not look nearly so low compared with
South Africa (21,l in 1981) as they did in 1974, before the big upsurge in
OECD unemployment rates l) .
Some have suggested that Simkina' estimates suffer from a lack of cyclical
sensitivity. Examination of Table 2 and the graph in Figure 1, hwever,
show clearly that they have been responsive to cyclical factors2).
The only feature of the data which may cause some misgivings on this score
is the fact that there is no significant absolute decline in the South
African unemployment rate during the economic upswing from 1978 to 1981,
even though there is a marked deceleration of the upward trend in 1979, a
minor absolute fall in 1980 and only a very slight increase in 1981 to the
1979 level. As we shall see belar there are good reasons for this, but in
any case the OECD data presented above suggest that the tendency for the
unemployment rate not to fall during an economic upswing is not something
peculiar to South Africa. A similar, persistent upward trend emerges in
the case of several other countries: Spanish unemployment rates go on
increasing throughout the OECD boom from 1976 to 1980, as do the French,
the Italian (but for a minor decrease in 1980) and the 6elgian3),
1) It is also noteworthy that the Spanish unemployment rate increases
from 2.4 per cent in 1970 to 16.6 per cent in 1982 whereas the South
African rate rose from 16,2 per cent in 1970 to 21.1 per cent in
1981, so that the Spanish rate not only rose proportionately more but
also by a larger number of percentage points. The magnitude of the
increase in the unemployment rate in this country is therefore not
out of line with experience elsewhere.
2) Figure 1, for instance, shows that from 1970 to 1977 the British and
South African unemployment rates move up and down together in more or
less perfect unison, so that over this period at least the South
African estimates are as cyclically sensitive as the British.
3) In several other cases the unemployment rate does not fall in all the
years of the cyclical upswing of the latter 1970s.