Investigating the self-employed: the South African perspective

Type Journal Article - Journal of Entrepreneurship in Emerging Economies
Title Investigating the self-employed: the South African perspective
Publication (Day/Month/Year) 2023
Purpose – In a country that is marred by an excessively high unemployment rate, there is a need for policymakers to prioritise entrepreneurship in South Africa. The study aims to explore the determinants of self-employment among the youth in South Africa and in the process answer the following question: Who are the self-employed youths in South Africa?
Design/methodology/approach – Different potential predictors of self-employment empirically used in the literature were used in this study. A probit regression model was used with the binary self-employment variable as the dependent variable and a host of independent variables. A nationally representative survey consisting of youths was used in the analysis.
Findings – The findings show that financial literacy increases the odds of being self-employed. Secondly, the odds of being self-employed increase with age as mature people are expected to have gathered enough networks and wisdom over the years. Thirdly, being male decreases the odds of being self-employed. When it comes to education, the only category that statistically increases the odds of being self-employed compared with no schooling is the tertiary level of education. The other educational levels are all statistically insignificant. From a policy perspective, the government should promote self-employment by investing in
financial literacy as well as increasing access to tertiary education among disadvantaged groups.
Originality/value – The study is one of the first, to the best of the authors’ knowledge, to examine the characteristics of the self-employed using a nationally representative survey in South Africa.

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