ABSTRACT
One of the most pressing policy matters concerning contemporary South African urbanization surrounds the ‘absorptive capacity’ of the cities. With the abandonment of influx control and adoption of orderly urbanization, critical importance attaches to the propensity of the country's urban centres for managing employment generation, income enhancement and the accommodation of increasing numbers of new migrants (Rogerson 1989a). The dramatic reduction in the capacity of the formal sector to create new income opportunities for work-seekers (from 73.6 per cent between 1965– 1970 to a meagre 12.5 per cent for 1985–90) has directed attention to the income and job-creation potential of the informal economy. Against the backdrop of economic recession and increasing structural unemployment, during the 1980s the economies of South Africa's largest cities showed evidence of ‘informalization’ (Rogerson 1987, 1988a, 1988b; Rogerson and Hart 1989). More specifically, the process of informalization witnessed visible new growth across a range of street or pavement-centred activities (hawking, street barbers, taxi operations, herbalists, prostitution, begging), an expansion in an array of home-based enterprises (shebeens, spaza stores, hairdressers, backyard workshops) and a small rise in the category of newly ‘formalized’ ventures situated within fixed business premises (small-scale industry, liquor taverns, vendors). In the rapidly changing policy climate of the 1990s, amidst all the feverish debates about ‘fundamental economic restructuring’, ‘democratizing economic growth’ and new strategies of ‘growth through redistribution’ (African National Congress 1990; Gelb 1990; Kaplinsky 1990), sight must not be lost of the central economic role which small-scale enterprise and the informal sector continue to play in South Africa's cities.
