Business Intelligence

Where You Live Matters: Urbanisation And Labour Markets Outcomes

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Executive Summary

Given apartheid's legacy of irrational spatial planning it should be unsurprising that location matters for labour market outcomes. This paper attempts to quantify this effect by introducing a new urbanisation index into standard employment regressions. Utilising a multinomial logit model, it is found that there is a positive relationship between the probability of being employed and the degree of urbanisation. For example, an individual in Johannesburg is 1, 5 times more likely to be employed than a similar individual in a medium-sized town such as Harrismith, and twice as likely to have a job as someone in a small town such as Mthatha.

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