Education Screening in South Africa's Labour Market

This paper empirically contributes towards the debate between the human capital and screening theories. Using South Africa's September 2004 Labour Force Survey data, and after controlling for self-selection, the weak and strong versions of screening hypothesis are tested. The honour's degree, and certificates or diplomas got without grade twelve, provide evidence for the SSH for both public and private sectors, as per the Wolpin (1977) methodology. The same methodology yield evidence in support of the WSH, at the masters and beyond certificate levels in the private sector, but stretching lower to include all other credentials up to and including certificates or diplomas got after grade twelve, in the public sector. Support for the WSH as per the Psacharopoulos (1979) methodology, prevails across the certificate levels, for the entire screened sample. The human capital theory, per se, is supported in the private sector for credentials below the honour's, except for certificates or diplomas got without grade twelve. There is no evidence to support the use of education entirely for its skills bestowing role in the public sector. Results from the Altonji and Pierret (1996) methodology do not also confirm any post-employment screening, whatever the sector. (Words :194)