Bell, Trevor : Unemployment in South Africa

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significance1). However, the finding by some studies in the mid-1970s that the unemployment rate was high in an absolute sense would probably have aroused comparatively little interest if it had at the same time been agreed that the unemployment rate was falling rather than rising. What is therefore, more important both for political reasons. and simply as a major indicator of whether the wellbeing of the community is improving or deteriorating, is the movement of the unemployment rate over time. Thus it is the cyclical and secular movement in the unemployment rate which most needs to be understood, and, if possible, controlled2). Let us, therefore, now briefly consider the relevance of the distinction between voluntary and involuntary unemployment for the observed trend in the unemployment rate. Say that despite all the obstacles outlined above a full employment equilibrium is eventually reached. What of those who remain unemployed in the new long-run equilibrium? %at, for instance, of a person who, originally retrenched due to recession, turns down a job in the long-term 1) For instance, high Black unemployment rates compared with Asians, Coloureds and Blacks, or with foreign countries may be relevant in the "engagement-disengagement" debate. AnothOr important need to measure the absolute level of unemployment at a particular point in time, and to know something of its character, would arise if a government were contemplating the introduction of a non-contributory unemployment insurance and it therefore wished to work out the budgetary implications of doing so. 2) Despite this, and the basic problem of arbitrariness, much of the debate on unemployment in South Africa has been about the static issue of the absolute level of the unemployment rate, and hence implicitly about the causes of unemployment at a point of time. Implicitly it has largely dealt with the question of the nature and extent of unemployment in full, long-run equilibrium rather than with the explanation of cyclical and secular movements.
equilibrium situation, reached eventually after a long period of adjustment. Say after adjustment to the deflationary shock, individuals vho vould have othervise have been offered and vould have accepted jobs, decline inferior jobs because they consider it unsuited to their ability, because it entails shift-vork, because transport costs are too high, because it is too far avay, or, in the case of homelands dvellers, because the return to vorking the land vas simply not considered vorth the effort. Should such vorkers be regarded as underemployed, voluntarily unemployed or involuntarily unemployed7 A prevalent viev is that the vorker is voluntarily unemployed and that this is therefore not a problem of unemployment. Our description of this case, hovever, shovs that even such an increase in voluntary unemployment represents a deterioration in the community's vell-being, and that contrary to the impression the term "voluntary" gives, represents a real social problem originating in a decline in the availability of employment1). Thus rising longrun unemployment rates, vhether seen as involuntary, or as involving a rising natural rate of unemployment, and therefore voluntary, may represent a real social problem of unemployment. Whether ve choose to label it 'voluntary' or 'involuntary', therefore, is irrelevant. In current economic conditions, and taking into account the basic underlying forces bringing it about, a rising index of unemployment reflects a problem vhich may perfectly reasonably be called a problem of unemployment2). 1) We may, therefore, perhaps equally appropriately call it a problem of "employment" rather than one of "unemployment". What is essential, hovever, is that vhichever term ve use a rising unemployment rate repreaents the vorsening of a real social problem. 2) It might be noted that, vith very fev exceptions, economists in the advanced industrial countries, do not deny that unemployment rates have risen or that this represents a vorsening situation. Indeed even monetarists abroad generally concede that the increase largely represents involuntary unemployment. The main disagreement has been over hov lonq-lasting the increase is likely to be.
Page 2 and 3: INSllIUTt TOR SOCIAL AND ECONOMIC R
Page 4 and 5: i CONTENTS Page - u.t of Tabla0 and
Page 6 and 7: Preface This paper is an extension
Page 8 and 9: Applications by whltea for Employme
Page 10 and 11: Simkins. His work is noteworthy par
Page 12 and 13: There is not, to my knowledge, anot
Page 14 and 15: The evidence thus suggests a persis
Page 16 and 17: ~i~~~~ 1: UNEMPLOYMENT PATES: UNITE
Page 18 and 19: Table 5: Unemployment Rates in Scnn
Page 20 and 21: Thue in a number of other countries
Page 22: Table 6 Registered Unemployment Rat
Page 25 and 26: Table 7 Non-Agricultural Employment
Page 28 and 29: In the case of Blacks, employment g
Page 30 and 31: governwant intervention in foreign
Page 32 and 33: Real Intwraat Rats and Rats of Incr
Page 34 and 35: Table 9 Real Interest Rates and Ave
Page 36 and 37: grawth in general rather than to an
Page 38 and 39: hetbr th. unemployment in voluntary
Page 40 and 41: it is argued that for a small open
Page 42 and 43: imzlO.ion of this form of voluntary
Page 46 and 47: Thus where the unemployment rate sh
Page 48 and 49: have expected a substantial increas
Page 50 and 51: vii) Finally, amongst the causes of
Page 52 and 53: traditionally been considerably hig
Page 54 and 55: already become much more difficult
Page 56 and 57: unemployment is deregulated markets
Page 58 and 59: 'thirties and even the postvar peri
Page 60: might, JB (1982) "The Nature of Une

Bell, Trevor : Unemployment in South Africa

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