The academic analysis of the labour market impacts of globalization has been dominated by neoclassical approaches both in the extensive work on developed countries and the more limited, but growing literature on developing countries. However, in many developing countries the positive impacts predicted for workers in (unskilled) labour-abundant economies have not been observed. This suggests that heterodox approaches may have an important contribution to make in analysing labour market outcomes. The paper contrasts the neoclassical and heterodox interpretations, reviews previous empirical studies of South Africa, and presents new data and analysis of the South African manufacturing sector.