The new inequality: based on employment more than race

25 June 2014 | Story by Newsroom

Patterns of inequality in South Africa are changing, and the great divide in cities and townships is between those with jobs and an education and jobless labourers, writes Owen Crankshaw.

There is a persistent belief among many South Africans that the apartheid characteristics of our cities have not disappeared. Whites are still rich and live in the leafy "suburbs". Blacks (Africans, coloureds and Indians) are still poor and live in the dusty "townships" and informal settlements.

Our cities are therefore seen as still the same as they were during apartheid, reflecting ongoing, unchanging patterns of racial inequality in jobs and housing. The implication of this argument is that, somehow, the ANC government has been powerless to transform our cities.

However, research does not support this claim. It is true that overall racial inequality has declined only slightly over the last 20 years. But this does not mean that nothing has changed.

In fact, racial inequality has not disappeared precisely because our cities have changed fundamentally. In other words, the kind of inequality that exists today is different from the kind that we experienced during apartheid. Correspondingly, there are new causes of today's inequality that are also quite different from those that existed during apartheid.

The fundamental change is that inequality within races has increased. Most significantly, the upward mobility of well-educated blacks into managerial, professional and technical jobs has resulted in a large, well-paid, black middle class.

Rising unemployment

At the same time, many less-educated blacks have become poorer because of rising unemployment. Whites have also become more unequal, but have remained, on average, wealthier than blacks. So, although the average income difference between whites and blacks has not changed much, this is because the growth in the number of poor, unemployed blacks has been matched by the growth of well-paid blacks. As a result, the average income for blacks, relative to whites, has increased only slightly.

How large is the black middle class in our cities? The Population Census and survey results show that the black middle class has grown from about one-fifth of the total middle class in 1970 to about one-half to two-thirds by 2013. In other words, whites are now a minority race in the middle-class jobs of managers, professionals and technicians. A similar trend took place among non-manual clerical, sales and service jobs. In 1980, less than half of these jobs were occupied by blacks. By 2013, the percentage of black clerical, sales and service workers had grown to 85%. So, racial inequality among the employed workforce is declining steadily as more and more blacks are employed in jobs that were previously monopolised by whites. Whites are no longer over-represented in clerical, sales and service jobs. They are still over-represented in managerial, professional and technical jobs, but their proportion is declining steadily.

These results should not surprise us. Since the dying days of apartheid, there has been no statutory racial discrimination in terms of access to education or jobs. On the contrary, government policy since 1994 has promoted the employment of blacks in jobs previously monopolised by whites. Furthermore, there was tremendous growth in all middle-class and clerical and sales jobs. In 1980, the number of managers, professionals and technicians was about one-third of all manual workers. By 2013, the number of managers, professionals and technicians had grown to the same number as all manual workers. Similarly, in 1980, there were only half as many clerical, sales and service workers as manual workers: by 2013, there were just as many of these white-collar workers as there were manual workers. This large increase in middle-class and other white-collar jobs could not be met by the small number of whites in our cities. The result was the steady racial integration of blacks into these jobs.

However, the racial integration and declining inequality among blacks and whites in middle-class and white-collar jobs stands in sharp contrast to the growing inequality between South Africans who have jobs and those who do not. An important cause of urban poverty today is the high rate of unemployment among less-educated blacks. This is a new form of poverty, which is replacing the income inequality between the races. In 1980, the unemployment rate was only about 5%. Since then it has grown to about 25%. Moreover, the causes of this high unemployment are not simply a consequence of continued racial discrimination. Unemployment has grown largely because the rate of employment growth has been slower than the rate of population growth. This is why so many of our youth are unemployed.

Skills mismatch

Another important reason is that semi-skilled and unskilled manual jobs have not grown as much as clerical, sales, managerial, professional and technical jobs. As a result, we have a skills mismatch with a shortage of non-manual or white-collar workers and too many manual workers. As a result, workers without a good education are more likely to be unemployed than those who are qualified for non-manual jobs.

These changing patterns of inequality in the labour market are resulting in new patterns of residential integration and segregation in our cities. The growth of the black middle class has resulted in the substantial racial de-segregation of the suburbs. In the formerly whites-only suburbs of Johannesburg, two-thirds of the residents are now black (and this excludes the tenants of backyard "granny flats"). The townships have changed too. On the one hand, they have benefited from the post-apartheid government's commitment to developing the public services and housing for the poor. On the other hand, they have seen the steady growth in backyard rooms and informal settlements, where the unemployed workers are concentrated: the rate of unemployment in the poorest townships is higher than 40%.

So, the new pattern of residential segregation in our cities is not the same as apartheid segregation. This new pattern of segregation is a division between the racially-mixed, middle-class suburbs, on the one hand, and the black, working-class townships with high levels of unemployment, on the other.

What are the implications of this new kind of inequality for government policy? If we wish to reduce inequality, we need to go beyond the current policy of affirmative action, because it benefits only the black middle class. We also need policies that will encourage businesses to employ low-skilled manual workers. This will help to reduce unemployment in the short term. In the longer term, we need to fix our schooling system and to generally spend more on education at both school and university levels. This should go some way to preparing our youth for employment in the growing world of non-manual jobs.

Owen Crankshaw is Professor of Sociology at the University of Cape Town. This article draws on the results of his joint research with Dr Jacqueline Borel-Saladin (Human Sciences Research Council) and on the published work of Prof Murray Leibbrandt and his colleagues at the Southern African Labour and Development Research Unit at the University of Cape Town.

This article first appeared in the Sunday Times on 8 June 2014

Images by Michael Hammond

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