Question

QUESTION 4

4.1 Write a paragraph in which you discuss the most import reasons for the high unemployment rate in South Africa. Discuss possible solutions to the unemployment problem

4.2. Currently there are indicators that the government wants to nationalise mines in South Africa. Discuss whether you think this is a good idea or not. Motivate your answer using sound economic arguments.

4.3. Explain why policy makers cannot solve the stagflation dilemma using only demand management policies.

Answer 1

ANSWER-1) South Africa is currently struggling with large unemployment and the main causes are combination of deficient demand for labour because of increasingly skills-intensive orientation of the country's economy, and substandard supply caused by the emergence of risky low-skilled labor. Legacy of apartheid and poor education as well as training is costing jobs. The women rate of entry into the labour market has risen sharply thus causing a rise in the number of job seekers over the years. Also higher demands for wages is causing decline in new employment. Furthermore there is a lack of interest for entrepreneurship. To beat unemployment South Africa require a change of mind-set from all role players, be it a business, government, or labour. There should be an education development. It should emphasis on improving the skill level of workers calls for structural remedies, such as a good school system and the improvement of labor skills; and entrepreneurship through education and training. Also when job seekers decide to be self-employed, government must give a friendly and an effective service that helps them persevere.