A recent study based on research by ReSEP members, Professor Servaas van der Berg and Hendrik van Broekhuizen furthers the consensus against the myth of high graduate unemployment in South Africa. The research was commissioned by the Centre for Development and Enterprise in an attempt to better understand the issue of graduate unemployment following media reports based on figures from Adcorp’s Employment Indices.
In stark contrast to Adcorp’s figures, the study found that less than 5% of the 1-million university graduates in the South African workforce were unemployed. The study furthermore reveals that White students constitute an ever-decreasing share of university graduates, with black graduates accounting for half of all graduates in the workforce by 2011. Based on these findings, the CDE suggests that barriers to the immigration of skilled workers should be lifted, given the high demand for skilled workers in the South African labour market.
The CDE study and the original research on which it was based also formed the basis for a number of pieces published in the media in April 2013. These include a Financial Mail article on the 4th of April 2013, a media release by FEDUSA General Secretary, Dennis George, on the 11th of April 2013, a Business Day article on the 12th of April 2013, and a City Press article on the 14th of April 2013.
ReSEP member and Stellenbosch University Professor Servaas van der Berg recently wrote an article for the online policy forum Econ3x3 in which he scrutinises recruitment firm Adcorp’s inherently inconsistent employment and unemployment figures. The article, which contests Adcorp’s frequently-cited assertions that there are some 600 000 unemployed university graduates in South Africa, but that the overall unemployment rate in the country simultaneously amounts to only 5%, was also the basis for an article published on the front page of the Business Day on February 15th 2013.
In research commissioned by the Centre for Development and Enterprise (CDE), Van der Berg and ReSEP member Hendrik van Broekhuizen find that, in stark contrast to Adcorp’s unsubstantiated claims, the number of unemployed individuals with tertiary qualifications at the end of 2011 amounted to 340 000 – just over half of Adcorp’s figure for university graduates alone. In fact, the research further reveals that the number of unemployed university graduates at the end of 2011 was only 55 000. (The background working paper to the forthcoming CDE report on graduate unemployment in South Africa can be downloaded here.) Based on the unexplained differences between these verifiable estimates and Adcorp’s figures, and the complete lack of transparency regarding Adcorp’s methodology and supposed sources of data, Van der Berg concludes that Adcorp’s employment statistics are no more than “dangerous fictions”.
Such critique of Adcorp’s figures are not the first of its kind. In 2012, Professor Martin Wittenberg and Dr. Andrew Kerr from the School of Economics and DataFirst at the University of Cape Town wrote two comprehensive papers discrediting Adcorp’s methodologies. Unfortunately, the media has since continued to publish Adcorp’s figures as though they come from a credible source.