Does South Africa Have the Potential and Capacity to Grow at 7 Per Cent?: A Labour Market Perspective

1) The avoidance of excessive wage demands (wage demands in excess of productivity
performance).

2) The establishment of long-term wage and salary discipline to contain inflationary
pressure.

3) The promotion of competition in all markets and the improvement of labour mobility,
(both geographically and in terms of skills), continuous upgrading of skills through
training and retraining (of both employers and workers) and the further liberalisation of
foreign trade policies.

4) The expansion of investment in human capital in terms of educational, as well as health
considerations.

5) Establishment of voluntary participatory principles in the collective bargaining process.

6) The limiting of the demonstration effect of excessive public service remuneration
packages on the general economy.

7) Encouragement the establishment and functioning of workplace forums.

8) The provision of more and timeous labour market information.

9) To reach an equitable balance between worker and employer rights and responsibilities.

10) Re-appraisal of the right to industrial action and minimising intimidation and
victimisation.

11) Provision of certain minimum standards in the workplace that must be weighed against
the needs of employers and the economy.

12) A re-examination of the effects of centralised minimum wage determination in relation
to cyclical and structural economic development

6. CONCLUSION

In this study the measure for potential output and its associated capacity utilisation were
presented for the South African economy. Even though different concepts and methodologies
exist, the estimation of potential output for South Africa is based on a structural production-

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