Money and Markets

SA salaries are increasing for the first time since May 2020, BankServ data shows

Business Insider SA

An arrow graph trend shaped 200 rand bank note sho
An arrow graph trend shaped R200 bank note. (Getty)
  • South African salaries are starting to grow again and have recorded a positive increase for the first time since May last year.
  • The nominal average take-home salary is now sitting at R15,821, up 4.7%, according to BankServAfrica.
  • Consumer confidence may get a boost from the growth in wages. 
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For the first time since May 2020, salaries in South Africa are starting to increase, data from automated clearing house BankServAfrica show. 

Many companies were forced to slash wages, streamline operations, or implement job cuts in some cases to mitigate the devastating economic fallout as a result of the coronavirus pandemic. The impacts have been felt mostly by low-income earners and workers who generally get paid daily.

According to BankServ’s data, the average monthly take-home pay increased 4.7% to R15,821 in February 2021, in nominal terms, while the average take-home pay in real terms rose 1.6% above inflation to R13,044, BankservAfrica’s Take-home Pay Index (BTPI) shows.

The trend is not all attributable to actual wage increases, though, Bankserv said but are as a result of fewer daily and weekly earners in the system, who typically are paid the least.

The average number of daily earners dropped 10.6%, while monthly earners decreased by 2.8%.

“Accordingly, inasmuch as the declining salary trend seems to have been reversed, the reality is that it was more as a result of a decline in the number of people that are actually being paid via the national payment system, particularly those that get paid on a daily basis,” says Shergeran Naidoo BankServe Africa’s head for stakeholder engagements.

“That being said, the relaxation of the lockdown levels and the opening up of economic activity would certainly have a positive impact on wages and salaries and we anticipate that as more businesses get back on their feet due to these relaxations, it could lead to more people getting reemployed and with real salary increases,” he adds.

The real value of total take-home to all employees only shows a rise of 0.2%. BankServ added that the positive move in salaries boded well for consumer spending, which may get a boost from the higher wages, and said, “it appears the declining trend in total pay has, for now, reached an end”.

(Compiled by Ntando Thukwana)

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