The role of mining in the South African economy

Abstract

This paper examines the contribution of three aggregate mining sectors of the South African economy to output and employment over the 1970-97 period. The finding of a declining importance of mining in output and employment creation must be sectorally differentiated. Gold and Uranium Mining is the chief source of these declines, while evidence for Coal and Diamond and Other Mining is more modulated. We find strong redistribution of output from equity to labour over the course of the 1990s for Gold and Uranium Mining. In mining labour markets, we present developments in employment trends, in real labour cost, and in labour productivity. We examine links between these dimensions in an explanation of changing employment trends. We conclude with a VECM estimation of a labour requirements equation to corroborate our findings