This report has two related objectives. The first is to clarify the relationship between the
length of stay in education and access to the job market based on South African
household survey data. The second is to contribute to what is known about what
influences participation in higher education institutions for young South Africans who
have successfully completed secondary school.
Regarding the first objective, previous studies have shown that young South Africans
who obtain a post-grade 12 qualification benefit from greater employment opportunities
in both the formal and informal sector. In section 1 of the report we interrogate this by
examining how much better off a young qualified South African in the job market is
compared to a less qualified contemporary. Over the post-apartheid period matriculants
have faced a hostile labour market when they exited school. Youth unemployment is very
high and the norm rather than the exception in many communities. If tertiary education is
seen as providing a successful route into the labour market, then the benefits will be
perceived to be large and, subject to financial constraints, there will be strong demand for
tertiary options.
This issue is explored by asking the question “Are there strong returns to tertiary study
and has this changed over the period 2000-2007?” We use national household survey data
to answer this question by comparing both employment rates and earnings among
graduates and non-graduates. We find consistently strong returns to tertiary education in
both employment and in the earnings of the employed. These findings are important
because the discussion of these returns is a little confused in the current policy milieu in
South Africa with much assertion about the high returns to more skilled work but also
some discussion of rising graduate unemployment.