Happy In The Informal Economy? A Case Study Of Well-Being Among Day Labourers In South Africa

Abstract

Past research provided evidence of the negative effect that individual unemployment can have on subjective well-being. The persistent high levels of unemployment and poverty in South Africa INTRODUCTION AND AIM OF THE PAPERhere was a time when the study of well-being, and subjective well-being in particular, was, for the most part, excluded from economic analysis as a result of the disciplinary paradigm of logical positivism. Yet, economic theories often include reference to values, expectations, and the like (Easterlin 2001: 225).Since the 1940s, the landscape has changed and, recently, Helliwell and Barrington-Leigh (2010) have argued that growing awareness is being raised in academic, policy, and public areas to subjective measures of wellbeing. This represents an important shift towards greater realism in the study of economic behaviour. Subsequently, a significant body of literature emerged on the determinants of well-being in developed countries. Recent research findings on well-being in developing countries specifically have added more depth to the development debate (Tiwari 2009: 129).Most studies on subjective well-being in transitional economies focus on either rural areas or gender groups. Prominent scholars in South Africa ensured that South Africa's transitional experience and its influence on well-being form part of this important research agenda (Møller and Schlemmer, 1989;Møller, 1998;Møller and Saris, 2001;Møller and Dickow, 2002;Ebrahim, Botha, and Snowball, 2011;Botha and Booysen, 2011). A constant theme in South African literature is that, in the main, the wealthier testify to higher levels of satisfaction and On the other hand, people in the Eastern Cape, a province with the high levels of unemployment and deep poverty, are principally unhappy, dissatisfied, and pessimistic.Cramm, Møller, and Nieboer (2010: 1013) state that there is a scarcity of research on well-being among the poorest of the poor. As a result, the experiences in terms of the well-being of marginalised groups in the South African labour market have not received sufficient attention in South African research on the subject.Past research results provided evidence of the negative effect that individual unemployment can have on subjective well-being (Winkelmann, 2009: 421). The persistent high levels of unemployment and the severity of absolute poverty in South Africa have been well documented. As a result, many people are forced into the informal economy where they engage a variety of survivalist activities. Offering their labour on street corners and at intersections as day labourers is a pertinent example in this regard. Blaauw (2010) found no pure economic rationale for the sustainability of this activity, given the cost and the low and uncertain levels of income in this market, yet many day labourers have been involved in this activity for many years. Researching the well-being in this informal labour market is an important extension of the research into the employee side of the informal economy. It takes cognisa...

Influences on happiness and subjective well-being of entrepreneurs and labour: Kwazulu-Natal case study

“…More money makes people happier because they can buy more (Coyle, 2012). Even in the case of South African day labourers in the informal economy, Blaauw, Botha, Schenck and Schoeman (2013) found that income and its increase are important in bringing about happiness, particularly when individuals are poor and live in deprived communities. In developing countries, higher income raises the happiness of poor people living below the bread line, enabling them to meet basic needs.…”

The subjective well-being of day labourers in South Africa: The role of income and geographical location

“…The study outlined in this paper expands on previous research by Blaauw et al (2013) (which looked at well-being in a general sense) by focusing specifically on the subjective wellbeing of day labourers and by introducing a new dimension: day labourers' geographical location, which is influenced by migration patterns. Migration and geographical differences are important considerations in a study of subjective wellbeing as they reflect day labourers' willingness to move from poorer to richer provinces in pursuit of greater economic opportunity and choice.…”

“…To investigate the impact of geographical location on the well-being of day labourers in South Africa, we employed a cross-sectional analysis using dummy variables for the nine provinces -which the exploratory study by Blaauw et al (2013) did not make provision for. The purpose of these dummy variables was to account for differences in the wellbeing of day labourers between provinces.…”

“…Blaauw et al (2013) conducted an exploratory study on the possible determinants of subjective well-being among South Africa's informally employed, using day labouring as a case study. The results from this study corroborated the importance of employment and income for both the objective and subjective well-being of those living in abject poverty (Blaauw et al 2013). However, changes in income and the quality of jobs are also tied to the location of the hiring sites within an urban or rural context.…”

“…A key element in the study of subjective well-being among day labourers is the income that they earn (Blaauw et al 2013). Table 3 shows the average income earned by survey participants in a 'good week' and 'bad week' respectively, across the different provinces.…”