The copyright of this thesis vests in the author. No quotation from it or information derived from it is to be published without full acknowledgementTown of the source. The thesis is to be used for private study or non- commercial research purposes only. Cape Published by the University ofof Cape Town (UCT) in terms of the non-exclusive license granted to UCT by the author. University Humanities Faculty: Sociology Department Spatial Mismatch in Cape Town:Town Business location and the impacts on workers Cape of By Claudia Naidu [NDXCLA004] Supervised by Professor Owen Cranks haw University Thesis presented in partial fulfillment of the requirements for the degree in Masters in Social Sciences at the University of Cape Town. Declaration I, Claudia Naidu, do hereby declare that this thesis is my own original work and that all sources have been accurately reported and acknowledged and that this document has not previously, either in its entirety or part been submitted at any university in order to obtain an academic qualification. Town Cape Claudia Naidu of February 2009 University Abstract The south east and cape flats regions of Cape Town is home to abundant supplies of cheap and available unskilled labour. With the awareness that Cape Town may be slowly following the developmental path of Johannesburg and many other cities of the world, as decentralization, suburbanization, and the overall processes of economic 'tertiarisation' and urban transformation encompass the entire structure and culture of the city, we wonder about how the cities unskilled workforces are faring. Development has focused on the north of the city while the south east has been bypassed, causing residents to have to travel far out to find jobs and work. There is a clear spatial mismatch between places of work and places of residence for the workers of the South east, and overcoming this disconnection is challenged further by an inefficient and expensive public transport service, upon which they are fully dependent. Town By way of the interviews with businesses from various industrial areas in Cape Town, this thesis shows that many owners and management do not place much importance on where their workers, in particular unskilled and semi skilled manual workers live and how theyCape travel. It seems that when choosing a location for their businesses, size, price, and availability may limit owners' options of location choice and interviews reveal that owners may be responding to rather thanof driving development. Findings reveal that unskilled manual workers typically reside in the south east, while business owners, management and other white collar workers typically live in the northern and southern suburbs, as well as other central areas. Furthermore, transport patterns were evaluated and it is clear that the unskilled workers rely heavily on public transport while higher skilled occupational groups either have their own car, or are part of lift-clubs. The problem of a spatialUniversity mismatch is clearly skewed towards workers of the south east who rely on public transport, by intensifying the burdens of commuting times and costs. A further finding is that many businesses resort to highly informal methods of recruitment, such as word-of-mouth and internal referral techniques, revealing the significance of social networks in gaining access to job opportunities. This is especially important for workers trying to find employment in areas outside of the traditional economic nodes as it is expensive to commute to those areas regularly in search of employment. Having access to those businesses through employed family members, neighbours and relatives, is therefore critical. ii Acknowledgement I would like to thank the following people, without whom this may have not been possible: To my friends, thank you for your motivation and encouragement, To my family, for your support, and To my supervisor, Professor Owen Crankshaw, my deepest and sincerest gratitude for your guidance, patience, support, and expertise. Town Cape of University iii Table of Contents Page Declaration Abstract ii Acknowledgement iii 1. Introduction 2. Literature Review 3 2.1. Spatial Mismatch Debate 3 2.2. Skills Mismatch Debate 4 2.3. Global City development and changing spatial orders 5 2.4. International Case Studies: Boston, Atlanta Town 8 2.5. Local Context: Johannesburg 11 2.6. Economic and Spatial Restructuring in Cape Town 13 2.7. Spatial trends and their impact on employment 22 3. Research Objective Cape 25 3.1. Research Question 25 3.2. Research Design and Methodology of 26 3.3. Description and overview of Industrial areas 33 4. Research Findings and Analysis 38 4.1. Initial Finding 38 4.2. Types of Workers employed by different companies 39 4.3. Workers: Residence and Transport Strategies 42 4.4. Recruitment Strategies 45 4.5. ConsequencesUniversity of the Spatial Mismatch 47 4.6. Motivations for choice of location 49 4.7. Concentration of certain types of businesses in particular areas 57 4.8. Links between business type, staff and location choice. 59 5. Discussion and Conclusion 64 References 66 Appendix A- Interview Schedule 70 Appendix B- Interviews 72 Primary Data 74 Secondary Data 97 iv Spatial Mismatch in Cape Town 1. Introduction Cities are continually undergoing changes. Recent developments in many cities across the world include expanding suburbanization, edge city and citadel development, and the emergence of new forms of ghettoes, all of which tend to increase the physical spaces between the wealthy and the poor (Marcuse and van Kempen, 2001). These spatial developments have occurred alongside changes in the economic functioning of the city as well as continual shifts away from traditional forms of production and manufacturing and towards more service-oriented and commercial activity. As a result, opportunities for white collar workers have continued to increase whilst generally leaving traditional blue collar workers in a precarious situation (Sassen, 1994). Furthermore, economic activity and opportunities, in increasingly relocating away from the traditional nodes and further away from the poor and unskilled has made them more vulnerable and isolated. This has made gaining access to employment opportunities difficult for the poor and unskilled workers as they face not only a skills mismatch in thisTown new economy of financial and commercial services, but also a spatial mismatch between places of work and opportunity and places of residence (Wilson, 1996). The public transport system, on which these types of workers are largely dependent, thus plays a pivotal role in connecting workers Capeto locations of economic opportunity. In Cape Town, the south east and cape flats regionsof are home to large numbers of unskilled blue collar workers. The city is growing and changing but minimal development has been targeted at the south east areas but instead, drawn towards the north, away from these workers (Turok, 2001). Close to many economic nuclei spread around the city, small informal settlements exist which enable residents to find employment at the nearby businesses. For those living further away however it means a daily commute to and from these nodes. UniversityThis means expense and time. It also involves a reliance on the public transport system which is largely fragmented and inefficient making the spatial mismatch between places of work and places of residence a difficult challenge to overcome (Clark and Crouse, 2002). In this research paper, one of the issues I examine is that surrounding choice of business location in an effort to grasp an understanding of why the north and other areas away from the south east are attractive and popular locations for development and business-establishment and why the south east, which is close to large pools of labour, is not suitable. I consider whether it is a matter of the type of labour needed, issues of image, safety, convenience, or business considerations such as good investment potential. A key focus is an examination on the existence of a spatial mismatch between places of work and residence, and a 1 Spatial Mismatch in Cape Town discussion of the challenges of this physical disconnection for different types of workers/occupational groups. Town Cape of University 2 Spatial Mismatch in Cape Town 2. Literature Review 2.1. The Spatial-Mismatch debate The notion of a spatial mismatch between where workers live and work was first conceptualized in the 1960s. In this work, John Kain (1968) aimed to explain the problems of unemployment and poverty faced by inner city black minorities and other disadvantaged communities within the urban areas of America. He emphasized the role of space rather than race, arguing that discriminatory housing policies trapped African­ Americans in the inner cities and thereby affected their and other non-white's opportunities for employment. This problem was further intensified by economic restructuring and the increasing outflow of business from the central city and their re-establishment in the suburban areas further away from the ghetto areas of the inner city. Town Empirical support for the hypothesis, based on quantitative research studies, has continuously been challenged 1 however and the notion of the spatial mismatch as the key to the black employment problem remains a contentious one (Kain, 1992., Pugh, 1998). WilsonCape (1996) writing in the mid-1990s on inner-city black employment problems, also points to the issuesof of the growing suburbanization of businesses and jobs and the effects this has on the job prospects for inner city residents. Wilson draws attention to inner city residents' reliance on the public transport system and the time, costs and difficulties involved in having to travel out to the suburbs. He stressed that the physical distances away from available job opportunities and social networks meant that they were spatially disconnected and isolated from the growing economic hubs. University Some support for the spatial mismatch theory has been documented by Margaret Pugh (1998).