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Two Policies to Alleviate Unemployment in South Africa - …

Two Policies to Alleviate Unemployment in South AfricaJames Levinsohn Ford School of Public PolicyUniversity of Michigan and NBERA ugust 28, 20071 IntroductionAt transition in 1994, the new South African government inherited an economy that hadsystematically disadvantaged most of the population. For almost a half century, Blacks1had been subject to an intentionally second-class education, labor laws that precluded theiradvancement, business regulations that outlawed many forms of firm ownership, and lawsthat kept them from living in the metropolitan areas that were the center of was about 15 percent. A dozen years later and all of these restrictionsof the Apartheid system have disappeared from the law.

5Some of the historical data in Table 1 pre-dates the Labour Force Surveys and in that case, the data are from the annual October Household Surveys. 6Data before 2000 are typically from the October Household Surveys while the figures from 2005 are drawn from the March Labour Force Survey (LFS). The data on labor market transitions are from matched

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