In this Occasional Paper, Prof Brian Kantor argues that it is not market failure but policy intentions that explain the outcomes in the labour market. In 2014, some 71 percent of all household incomes took the form of wages, salaries, and other benefits received from employers. The SA labour market statistics tell of a highly dysfunctional labour market. One where the supply of potential workers to the formal sector vastly exceeds the demand to hire them. Yet, one where real wages for those working in the formal sectors of the economy have risen consistently over the years, despite the abundance of work seekers.
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