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Skilled labour shortage in construction industry is a major challenge in South Africa. Therefore, the objective of the study is to assess the factors that cause skilled labour shortage, its consequent effects on the construction industries and how the scenario can be improved. The study was conducted by considering construction industry in the Eastern Cape of South Africa and using a survey research method and conceptual System Dynamics (SD) modelling. Findings reveals that investment, wage challenges, talent management, work environment, training, experience, and Government policy are the important challenges for the skilled labour shortage. Inadequacy of skilled labour considerably impacts the quality of work, productivity, and scheduling. The causal loop diagrams show that enhancement in investment in the labour wages will strengthen the availability of skilled labourers leading to higher productivity, and vice versa. Talent management based on appropriate recruitment and retention policy, staff development programmes and investment in these aspects will augment the skilled labour pool. Also, a better work environment through a policy of health and safety, investment in working condition and supported by Government policy will reduce the attrition of the labourer because of job dissatisfaction, which consequently will reduce the skilled labour shortage in the industry.

Unemployment is one of the most serious problems facing Nigeria like many other countries in the world. Nigeria is becoming a predominantly youth society with high rate of unemployment. The development of youth is critical to economic survival and vibrancy of any nation. In order for a country to achieve her development aspiration, the youths need to have access to education that will enable them to enhance their standard of living and gain competitive skills that will be in high demand in the labour market. Young people that lack skills that are valued in global and local economies face limited job opportunities and income growth. The changing nature of work today is placing increased pressure on the youths to acquire technical and vocational education skills. With the youths among the big losers of the recent economic crisis, technical and vocational education is often seen as the silver bullet to the problem of youth joblessness.

The ratios of spending on R&D, advertising and marketing to sales are employed accordingly as direct determinants of the degree of vertical and horizontal product differentiation. The model is verified with direct regressions and a system of simultaneous regressions combining large firm survey with sector-level data from the UNCTAD for 13 Central and Eastern European countries. The econometric results evince that the increased demand for skilled labour (human capital) was greater than any FDI-induced labour market spillovers. As expected, this contributed to less differentiation which became more costly. Consistently, foreign-owned enterprises employed more highlyskilled employees but they reacted to more foreign investment similarly to domestic firms (so reducing the level of differentiation). Das Verhältnis für Ausgaben für R&D, Werbung und Marketing zu den Verkäufen wurden als direkte Determinanten für den Grad der vertikalen und horizontalen Produktdifferenzierungen genutzt. Das Model wurde mit direkten Regressionen und einem System simultaner Regressionen verifiziert welches mit großen Firmen Untersuchungen mit sector level? Daten von UNCTAD für 13 Zentral- und Osteuropäische Länder. Die wirtschaftlichen Resultate zeigen das die steigende Nachfrage nach ausgebildeten Arbeitskräften (menschliches Kapital) größer als jeder FDI-induzierte Arbeitsmarktüberschuss.Wie erwartet, führte dies zu weniger Differenzierung was kostenintensiver wurde. Ständig stellten ausländische Firmen mehr hochqualifizierte Angestellte ein aber sie reagierten auf größeres ausländisches Investment ähnlich wie inländische Firmen (so reduzierten sie das Niveau der Differenzierung).

The paper develops a three-sector, specific factor, general equilibrium model with two high-skill sectors and unemployment of skilled labour. One of the two high-skill sectors produces a non-traded commodity whose aggregate demand consists of both domestic demand and an exogenously given foreign demand. The consequences of a decline in the foreign demand for the non-traded good resulting from worldwide economic recession on the skilled and unskilled labour markets in a developing economy have been examined. The analysis finds that the effects on the labour markets crucially hinge on the relative factor intensities of the two high-skill sectors and that through adoption of appropriate fiscal measures; the country can shield its workforce from the rage of global economic downturn.

The paper purports to examine the consequences of foreign direct investment (FDI) in agricultural land in a developing economy using a three-sector general equilibrium model with simultaneous existence of unemployment of both skilled and unskilled labour. The analysis finds that FDI in agriculture does not only improve national welfare unequivocally but also mitigates the unemployment problem of both types of labour. The paper theoretically justifies the desirability of flow of FDI in agriculture in the developing economies.

The paper develops a three-sector general equilibrium model that can explain simultaneous existence of unemployment of both skilled and unskilled labour. The unemployment of unskilled labour is explicated in terms of rural-urban migration mechanism while that of skilled labour is shown using the ‘fair wage hypothesis’. The paper finds that foreign direct investment (FDI) in the primary export sector improve both national welfare and urban unemployment problem of unskilled labour while the consequences of foreign capital flows into the import-competing sector and high-skill export sector are ambiguous. The paper justifies the desirability of FDI flow in the primary export sector from the perspective of both unemployment and social welfare.

The paper develops a three-sector specific factor model with Harris-Todaro type unemployment to examine the consequences of economic recession in the skilled sector on the informal sector workforce. It finds that while a decrease in the price of high-skill commodity raises both the informal (rural) sector wage and unemployment of unskilled labour, a drop in emigration of skilled labour produces exactly the opposite effects. The effects of these policies on the welfare of unskilled workers in terms of the welfare measure of Sen (1974) have also been studied. The paper recommends a protectionist policy to the unskilled labour-intensive sector for protecting the interest of the vulnerable section of the working population.

This paper has developed a three-sector general equilibrium framework that explains unemployment of both skilled and unskilled labour. Unemployment of unskilled labour is of the Harris–Todaro (1970) type while unemployment of skilled labour is caused due to the validity of the FWH in the high-skill sector. There are two types of capital one of which is specific to the primary export sector while the other moves freely among the different sectors. Inflows of foreign capital of either type unambiguously improve the economic conditions of the unskilled working class. However, the effects on the skilled–unskilled wage inequality and the extent of unemployment of both types of labour crucially hinge on the properties implied by the efficiency function of the skilled workers.

Agell and Lundborg (1995, Economica) have accommodated the fair wage hypothesis (FWH) in an otherwise 2×2 Hechscher-Ohlin-Samuelson model for examining the robustness of certain standard trade theorems. The present paper proposes to introduce the FWH in a three sector general equilibrium model with two types of labour: skilled and unskilled. Skilled labour is specific to the high-skill sector and receives the efficiency wage while unskilled labour in the other two sectors receives either the competitive wage or the high unionized wage. Using such a framework the consequences of international mobility of factors of production on the skilled-unskilled wage inequality and unemployment of skilled labour in a developing economy have been analyzed. Both foreign capital inflows and emigration of skilled labour improve the skilled-unskilled wage inequality under reasonable condition. Particularly, the result relating to emigration of skilled labour is counterintuitive.

We propose and solve a simple model of firm-level decisions to offshore production stages of lower skill intensity than that of activities that remain in the domestic location. In theory, offshoring is optimal only for the more productive among heterogeneous firms if it entails a fixed cost. In a large sample of Italian firms, offshoring - especially of intermediate production stages - is indeed more prevalent among firms that are larger and more productive, and is predicted by arguably relevant firm-level characteristics. We also document that offshoring decreases the share of unskilled employment in domestic production facilities as well as firms’ propensity to employ immigrant workers, and we discuss the possible determinants and policy implication of the latter finding.

The paper develops a four-sector general equilibrium model where the fair wage hypothesis is valid and there is agricultural dualism for analyzing the consequence of an inflow of foreign capital on the skilled-unskilled wage inequality and the unemployment of skilled labour in a developing economy. The unskilled workers are fully employed but there is imperfection in the market for unskilled labour. On the contrary, the skilled wage is set by the firms by minimizing the unit cost of skilled labour and their efficiency depends on the relative income distribution and the unemployment rate. The analysis finds that an inflow of foreign capital worsens the relative wage inequality but lowers the unemployment of skilled labour. It provides an alternative theoretical foundation to the empirical finding that inflows of foreign capital might have produced unfavourable effect on the wage inequality in the developing countries during the liberalized regime by increasing the relative demand for skilled labour.

Empirical evidence is compelling that large firms are more productive than small firms. The hypothesis in this paper is that the productivity differences between small and large firms are associated with two of the main determinants of a firm’s performance: the human and technological capital that firms incorporate. We suggest that the contribution of these factors in explaining the size of the productivity gap might not only be due to the fact that large firms make a more extensive use of them, but also because large firms obtain higher returns from their investment in human and technological capital. The evidence we obtain for a comprehensive sample of Spanish manufacturing firms (1990-2002) supports this hypothesis, which has important implications for the effectiveness of policies designed to improve productivity in SMEs by stimulating innovation and the use of more skilled workers.

The existing theoretical literature does not take into consideration the existence of non-traded goods and the nature of capital mobility between the traded and the non-traded sectors in analyzing the consequences of liberalized investment policies on the relative wage inequality in the developing countries. The present paper purports to fill in this gap using two four-sector general equilibrium models reasonable for a developing economy. We have found that inflows of foreign capital usually improve the wage inequality when the low-skill sector is capital-intensive. But, the relative wage gap may widen if the high-skill sector is capital-intensive. When the non-traded sector produces a non-traded final commodity wage inequality worsens if the low-skill sector is capital-intensive and employs only a very small proportion of the unskilled workforce and if the primary export sector is unskilled labour-intensive. Appropriate policy recommendations for improving the wage inequality have also been made.

The paper develops a three-sector specific factor model with Harris–Todaro type unemployment to examine the consequences of international factor mobility on the skilled–unskilled wage inequality and urban unemployment of unskilled labour in a small open dual economy. The theoretical analysis shows that the consequences of international factor mobility on wage inequality may not necessarily depend on the difference in the factor intensity condition. Only when the unskilled wage in the low-skill urban sector is positively related to the rural wage, factor intensity conditions do matter. An emigration of skilled labour or an inflow of foreign capital may move the wages in favour of the unskilled labour and lower the magnitude of urban unemployment only if the low-skill urban sector is capital-intensive (in a special sense). But, an immigration of unskilled labour produces exactly the opposite effects. The paper argues that provided the government undertakes supplementary measures to curb trade union power and prevent illegal immigration of unskilled labour, abundant inflows of foreign capital might be a solution to both deteriorating wage inequality and increasing unemployment of unskilled labour in the liberalized regime.

Gains from productivity and knowledge transmission arising from the presence of foreign firms has received a good deal of empirical attention, but micro-foundations for this mechanism are weak. Here we focus on production by foreign experts who may train domestic unskilled workers who work with them. Gains from training can in turn be decomposed into two types: (a) obtaining knowledge and skills at a lower cost than if they are self-taught at home; (b) producing domestic skilled workers earlier in time than if they had to rediscover the relevant knowledge through ‘reinventing the wheel’. We develop a three-period model in which the economy initially has no skilled workers. Workers can withdraw from the labour force for two periods of self study and then produce as skilled workers in the third period. Alternatively, foreign experts can be hired in period 1 and domestic unskilled labour working with the experts become skilled in the second period. We analyse how production, training, and welfare depend on two important parameters: the cost of foreign experts and the learning (or ‘absorptive’) capacity of the domestic economy.

Australian manufacturing is a picture of diversity and contrasts. This is the main finding of this paper which examines trends in the Australian manufacturing sector over the last two decades. Manufacturing output has quadrupled since the mid-1950s. The fastest growing activities have been those with links to Australia^Rs n atural endowments and products that are more differentiated, with higher skill levels and R&D intensities.

The paper investigates the shift in demand towards more skilled labour in Swedish manufacturing during the last two decades. Two competing hypotheses to explain this shift are examined: skilled-biased technical change and increased international competition.

This new model of international trade patterns is based on differing relative labor costs derived from differing endowments of skilled and unskilled labor, when labor is in elastic supply because of social support systems. All factors other than labor are assumed to be mobile across frontiers; constant returns to scale prevail. The model predicts that (1) high wage countries will export goods intensive in skilled labor (a hierarchy is proposed from 'expensive', skilled-labor-intensive, and often new products or services, all the way to 'cheap', unskilled-labor-intensive, often old products capable of mass manufacture); (2) wage equalization across borders for the same labor type can be frustrated by social support, notably for unskilled workers in high wage countries, who will be unemployed; (3) mercantilism has a pay-off in the form of lower unemployment. The theory is tested empirically in three ways. First, assuming unit value indices (uvis) are an index of 'expensiveness', country uvis are regressed on country wages for SITC 3-digit groups in textiles, machinery, and electrical apparatus. Second, country net exports in expensive and cheap labor commodity groups are regressed on country wages. Finally, country net exports are regressed on an index of skilled-labor-intensiveness for high-wage, low-wage and intermediate-wage countries.