The impact of South Africa’s labour laws on employment growth has been a central concern for policymakers, business leaders, and workers alike. While the country’s regulatory framework was designed to protect workers’ rights and ensure fair treatment, mounting evidence suggests that high levels of regulation have created significant barriers to job creation, particularly for young and entry-level workers.

Polling data reveal a strong public perception that current labour policies deter employment growth. Over 85% of South Africans agree that “South Africa’s labour laws make it difficult to create jobs and the laws should be relaxed so that more people can find work”. Support for reform is broad-based, spanning all race groups and political affiliations, with majorities in the ANC, DA, and EFF supporting greater labour flexibility.

Employment trends reinforce these perceptions. While total employment expanded in the 2000s, the pace of job creation has slowed significantly in the past decade, with unemployment rates rising to 32.9% by 2024, among the highest globally. Rigid hiring and firing procedures, high entry costs for employers, and onerous compliance requirements contribute to employers’ reluctance to create new positions, especially for first-time job seekers.

International comparisons further highlight the issue. Countries with more flexible labour markets typically enjoy lower youth unemployment rates and higher rates of job growth, as firms are able to adjust to changing conditions and take risks on less experienced workers. In South Africa, by contrast, regulatory barriers have contributed to a dual labour market, where those with jobs are protected but millions remain excluded from formal employment.

If South Africa aims to achieve higher employment growth, evidence suggests that labour market reform must be part of the solution. Lowering barriers to hiring and adapting regulation for small businesses could open the way for more inclusive growth and opportunity, especially for the country’s young and unemployed.