Conceptual framework

Wage Analysis: A Conceptual Framework

An analysis of wage trends, focusing on issues of skills-mismatch and the relationship between supply and demand for particular sub-sectors, skill-levels and occupations, across the wage distribution

Labour Market Intelligence research programme


The South African labour market is characterised by a severe mismatch between the skills required by firms and those available in the labour force. This is exacerbated by the continued skills-biased demand trajectory in the economy, where within particular industries and occupations highly skilled workers are in short supply and experience rising incomes, while there is a growing pool of low-skilled workers with limited formal education or training who are unable to find work. A central mechanism in the relationship between demand and supply in the labour market is the wage level – indeed understanding wage changes over time, and how they differ in relation to various sectoral, demographic and occupational characteristics can reveal key insights about changing labour market demand and supply. This is the focus of the paper, which intends to feed back into policy questions around sectoral and occupational skills requirements, educational and skills constraints, possible future skills demands, and the changing nature of work in the country.  

This publication covers

  • Key concepts and purpose
  • Rationale and key research questions
  • Target group
  • Scope
  • Methodology and approach