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A policy for the jobless youth in South Africa: Individual impacts of the Employment Tax Incentive

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  • Amina Ebrahim
  • Jukka Pirttilä

Abstract

This paper uses survey and tax administrative data to analyse the effects of a sizeable employer-borne payroll tax credit for young, low-wage workers in South Africa. We find limited impact of the wage subsidy on employment of young, low-wage workers relative to two comparison groups: slightly older, low-wage workers and slightly higher paid, young workers. We find evidence of increases in entry into employment and decreases in separations of low-wage youth, but these are too small to affect overall employment.

Suggested Citation

  • Amina Ebrahim & Jukka Pirttilä, 2022. "A policy for the jobless youth in South Africa: Individual impacts of the Employment Tax Incentive," WIDER Working Paper Series wp-2022-124, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2022-124
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    File URL: https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2022-124-policy-jobless-youth-South-Africa-individual-impacts-Employment-Tax-Incentive.pdf
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    References listed on IDEAS

    as
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    11. Amina Ebrahim & Murray Leibbrandt & Vimal Ranchhod, 2017. "The effects of the Employment Tax Incentive on South African employment," WIDER Working Paper Series wp-2017-5, World Institute for Development Economic Research (UNU-WIDER).
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    Keywords

    Employment; Youth; Wage subsidy; Youth unemployment; South Africa;
    All these keywords.

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