Location of Repository

Wages and wage elasticities for wine and table grapes in South Africa

By Beatrice Conradie

Abstract

A survey of 190 wine and table grape farmers in the Western Cape puts the average wage for farm labour at R928 per month in 2003 and R1123 per month in 2004. Output per worker has doubled since 1983. On farms with grape harvesters, labour is 30 per cent more productive (48 ton/worker) than on farms where wine grapes are picked by hand (37 ton/worker). At 9.75 tons per worker, table grapes are four times as labour-intensive as wine grapes. Resident men dominate the workforce on wine farms, while the resident female workforce is 20 per cent larger than the resident male workforce on table grape farms. Seasonal workers contribute a third of labour in table grapes, and brokers less than ten per cent in either case. In a single-equation short-run Hicksian demand function, wage, output, capital levels and mechanisation intensities are highly significant determinants of employment. Higher wages decrease employment and larger output increases employment. More mechanisation, measured by the number of tractors used to produce a ton of fruit, raises labour intensity too. Grape harvesters could not be shown to reduce jobs. The ten per cent rise in the minimum wage planned for March 2005 could reduce employment by 3.3 per cent in the wine industry and 5.9 per cent in the table grape industry, but it is more likely that the wage increase will be offset against fewer benefits. The average expected impact is about the same as for all agriculture and manufacturing as a whole.Labor and Human Capital,

OAI identifier:
Downloaded from http://purl.umn.edu/31716

Suggested articles

Preview

Citations

  1. (1985). A supply and demand analysis of regular Black labour in Natal.
  2. (2004). African Wine Industry Information & System
  3. (2000). Agricultural employment crisis in South Africa. Trade and Industry Policy Secretariat (TIPS) working paper 13_2000.
  4. (1995). Basic Econometrics. Third edition.
  5. (2002). C h a n g i n g l a b o u r m a r k e t c o n d i t i o n s i n South Africa: A sectoral analysis of the period 1970–1997. The South African
  6. (1987). Census of Agriculture
  7. (2004). Census of commercial agriculture
  8. (2005). Conradie Conradie BI
  9. (2004). Die ekonomiese volhoubaarheid van wyndruifverbouing in Worcester- en Rawsonville-streke. VINPRO vir Kaapse Wynprodusente.
  10. Estimating the price elasticity for family and hired farm labour in England and Wales.
  11. (1997). Farm labour remuneration, labour legislation and commercial farmers’ perceptions in KwaZulu-Natal.
  12. (2003). Human Rights Commission
  13. (1999). Input demands and inefficiency in US agriculture.
  14. (1999). Levels, trends and consistency of employment and unemployment figures in South Africa. Development Southern Africa
  15. (1998). South African labor markets: Adjustments and inequalities. Discussion paper 12, The World Bank Southern Africa Department.
  16. (1995). The effect of minimum wages on UK agriculture.
  17. (1932). The Theory of Wages.

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.