Abstract
Modelling the effects of gross value added, foreign direct investment, labour productivity and producer price index on manufacturing employment
Highlights
The declining share of manufacturing employment as a proportion of aggregate employment has been regarded as a cause for concern for policymakers and economists in emerging market economies and developing countries; South Africa is not excluded (Lawrence, 2018; International Monetary Fund (IMF), 2021; KPMG International (2020)
To ensure that the selected model is appropriate to the study’s underlined variables, this process was performed through the augmented Dickey-Fuller (ADF) and Kwiatkowski-Phillips-Schmidt-Shin test statistic (KPSS) tests
In line with foreign direct investments (FDI), this study found that an increase in labour productivity causes a decline in employment levels
Summary
The declining share of manufacturing employment as a proportion of aggregate employment has been regarded as a cause for concern for policymakers and economists in emerging market economies and developing countries; South Africa is not excluded (Lawrence, 2018; International Monetary Fund (IMF), 2021; KPMG International (2020). Economic theory recognises this role and regards the sector’s labour-intensive nature as contributory to sustainable economic growth through the generation of productive employment (Loto, 2012; Behun et al, 2018) This point is supported by Anyanwu (2017), who argues that the export-driven nature of the sector progressively increases the value of commodities before they are sold, boosting revenues and increasing input average revenues. These unique contributions by the sector regard manufacturing as a catalyst to economic growth and development (Jeon, 2008)
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