The Economics of Education in South Africa

Abstract

South Africa has made significant progress in raising education levels and reducing racial and gender gaps in education. Significant challenges remain, however, and progress in many dimensions has been disappointing. There continue to be substantial racial gaps in educational attainment, especially in the proportions completing secondary school and earning post-secondary qualifications. Although most learners attend nationally funded public schools, large differences persist in the quality of schools. These differences are reflected in large racial and socio-economic differences in test scores and low rankings in international comparisons. Education is strongly related to employment and earnings, with some of the steepest income-education gradients in the world. Returns to post-secondary education have increased, while there has been limited progress in access to post-secondary education. The combination of highly unequal education combined with strong effects of schooling on earnings and employment create a cycle in which inequality is transmitted across generations.