Abstract
This study investigated the determinants of educational mismatch in South Africa mainly from racial perspectives in the formal sector. Specifically, this study assessed the variability of these determinants across different economic conditions, characterised by periods of crises and stable periods. Making use of data from the Post-Apartheid Labour Market Series (PALMS), with analysis conducted using a Multinomial Logit Model, the study found that overeducation remains prevalent across all racial groups in both years of economic downturn and the quiet year. Black workers consistently face challenges related to both overeducation and undereducation, especially in higher-skilled occupations, such as senior managers and professionals. Despite improvements in educational attainment, education mismatch persists, pointing to structural inefficiencies in the labour market. This indicates that the South African labour market struggles to align workers' qualifications with appropriate job opportunities, exacerbating racial inequalities. Based on the findings of the study, the policy implications include the need for more targeted job creation in high-skill sectors, better alignment between educational outcomes and labour market needs, and stronger affirmative action policies to address racial disparities in job matching. Future research should focus on longitudinal studies to track career trajectories over time and investigate sector-specific trends in education mismatch.