Race and class inequality in South Africa

Many commentators argue that South Africa has not changed fundamentally since apartheid, and that racial inequality has continued because the basic structures of the old system have remained untransformed. Owen Crankshaw challenges these views and argues that the labour market in Gauteng, South Africa’s largest province, has been dramatically restructured.

By Owen Crankshaw

Many scholars and commentators hold the view that South African cities have not changed substantially since the end of apartheid. They argue that racial inequality has persisted because the basic structures of apartheid have not been dismantled. Some even go so far as to say that racial inequality persists because of continuing racial discrimination and oppression by white people.

My research on employment trends in Gauteng over the period 1970 to 2011 has produced evidence that challenges this view in several ways. First, the results show that the labour market in Gauteng has not remained the same since the end of apartheid. On the contrary, it was dramatically restructured, producing new winners and new losers in ways that substantially undermined the old apartheid order.

In 1970, unemployment was very low, and most workers were employed in manual jobs, either as unskilled labourers or as machine operators and assembly-line workers. Forty years later, unemployment was extremely high, and most workers were employed in non-manual jobs, as clerks, sales and service workers, technicians, professionals and managers. This changing labour market, which benefitted better-educated workers and severely disadvantaged poorly-educated manual workers, also substantially changed the pattern of racial inequality.

For white workers, this resulted in their continued prosperity, which took the form of a low unemployment rate and their over-representation in high-income technical, professional and managerial middle-class jobs. However, white workers were not the only people to benefit from the growth of middle-class jobs. The growth of high-income middle-class jobs far exceeded the supply of the white workforce and therefore provided middle-class employment opportunities for many well-educated black, mostly African, workers.

The same trend took place in middle-income non-manual clerical, services and sales occupations. These non-manual occupations grew more than other occupational groups, resulting in dramatic upward occupational mobility among better-educated black workers. By contrast, there was very little employment growth in manual jobs, in which mostly poorly-educated black workers were employed. In particular, there was almost no employment growth among middle-income machine operators and assemblers, which dealt a terrible blow to the gains made by the unionised black working class.

The result was therefore upward occupational mobility for many black workers into non-manual jobs. Although by 2011 white workers were still over-represented in high-income middle-class jobs, the black middle class was much larger than the white middle class. As far as clerical, sales and services jobs are concerned, the number of black workers had grown to the extent that white workers were no longer over-represented in these jobs.

However, this changing division of labour severely disadvantaged a great many poorly-educated black workers who were left jobless by the shortage of manual jobs. The combined effects of racially-unequal schooling during the apartheid period, generally low employment growth and the changing occupational structure meant that it was poorly-educated black workers who bore the brunt of an extremely high level of unemployment. By 2011, the number of unemployed black workers was substantially more than the number of middle-class black workers.

The evidence

1. De-industrialization and the changing occupational and earnings structure of employment

In 1970, at the height of the apartheid period, the labour market was dominated by the manufacturing sector and characterized by a low unemployment rate of only 5 per cent. Four decades later, in 2011, employment in the manufacturing sector was less than each of the services sectors. Furthermore, unemployment had grown to 26 per cent. In 1970, the manufacturing sector was the single largest employer, employing almost one-quarter of all workers. By 2011, this percentage had shrunk to only 10 per cent. Correspondingly, employment in the service sectors increased in absolute and relative terms. Most notable, employment in community, social and personal services grew from only 12 per cent in 1970 to 21 per cent by 2011. Similarly, employment in producer services grew from only 5 per cent to 21 per cent (Figure 1).

Figure 1. Employment change in the largest economic sectors in Gauteng, 1970 to 2011 (Error bars indicate the 95% confidence intervals).

Over the same period, the occupational structure of employment changed substantially. In 1970, 64 per cent of all workers were employed in low-income and middle-income manual jobs. By 2011, employment in these manual jobs had declined to only 40 per cent. Correspondingly, employment in high-income managerial, professional and technical jobs increased from 19 per cent of all employment in 1970 to 28 per cent in 2011. Similarly, middle-income clerical, sales and services jobs increased from 14 per cent of all employment in 1970 to 31 per cent in 2011 (Figure 2). So, over a period of forty years, the occupational structure was transformed from one that was dominated by low- and middle-income manual workers to one that was dominated by middle- and high-income non-manual workers.

Figure 2. Employment by low-, middle- and high-income occupational groups in Gauteng, 1970 to 2011. (Error bars indicate the 95% confidence intervals).

The labour market therefore changed from one that required workers mostly without a secondary-school education to one that required workers mostly with a completed secondary-school education or more. Between 1970 and 2011, the employment of workers without a completed secondary-school education stagnated. By contrast, the employment of workers with a completed secondary and tertiary education increased dramatically.

This changing occupational structure of employment was therefore a partial cause of rising unemployment. The reason for this is that about 60 per cent of unemployed workers did not complete their secondary schooling and about 60 per cent of employed workers had completed their secondary or tertiary education. Over the period from 1980 to 2011, which is the period when the unemployment rate increased, two-thirds of all employment growth among workers with at least a completed secondary school education took place in middle- and high-income non-manual jobs.

The other important reason for the high unemployment rate was the overall slow growth of employment in the face of a faster growth in the size of the population. Whereas from 1970 to 1980, when the unemployment rate remained low, the increase in the size of the economically active population was matched by employment growth. Between 1980 to 2001, the period during which the unemployment rate increased, the growth rate of the economically active population grew faster than the growth rate of employment. This explains why the unemployment rate is highest, not only among poorly-educated workers, but also among younger workers who entered the labour market during the period when employment growth was low and there was therefore a severe shortage of jobs.

2. The changing pattern of racial inequality

Although the occupational profile of white workers remained largely unchanged, the occupational profile of black workers changed substantially over the period from 1970 to 2011. In 1970, almost all black workers were employed in low-income and middle-income manual jobs. By 2011, this percentage had decreased to just less than 50 per cent. The remaining black workers were employed in high-income middle-class and middle-income non-manual occupations. This transformation resulted in the racial desegregation of employment in middle-class and clerical, sales and service occupations that were once predominantly filled by white workers. In 1970, at the height of the apartheid period, about 90 per cent of all high-income middle-class jobs were held by white workers. Forty years later, this percentage was reduced to only one-third (Figure 3). Similarly, the percentage of black workers in clerical, sales and service jobs increased from 50 per cent in 1970 to almost 80 per cent in 2011.

Figure 3. The changing racial composition of high-income, middle-class employment in Gauteng, 1970 to 2011. (Error bars indicate the 95% confidence intervals).

So, contrary to the argument that the old apartheid labour market has persisted, the evidence suggests that there were dramatic changes that have produced new kinds of earnings inequalities. First, the demand for labour shifted away from poorly-educated manual workers to better-educated non-manual workers. In the face of a small and slow-growing white workforce, this resulted in the dramatic increase in the numbers of black workers employed in high-earning middle-class jobs and in middle-income non-manual jobs. Second, the rise of unemployment resulted in widespread poverty among poorly-educated black (mostly African) workers.

Both these features of the labour market did not exist at the height of the apartheid period and therefore cannot be the result of the persistence of the racially oppressive apartheid system. South Africa therefore needs to urgently apply new solutions to these new causes of inequality. Specifically, the country must fix its secondary school system and expand its universities. South Africa must also encourage labour-intensive job creation in all sectors to reduce unemployment.

Owen Crankshaw teaches sociology at the University of Cape Town. He has written and researched widely on labour, labour markets, class and cities in South Africa.

Owen Crankshaw’s new book, Urban Inequality: Theory, evidence and method in Johannesburg is being published by Zed Books later in February.


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