Take-home pay, as tracked by the BankservAfrica Take-home Pay Index (BTPI), was stable in June 2025 following three consecutive months of moderation.
With inflation well contained and a widely anticipated interest rate cut expected on 31 July 2025, salary earners may experience some short-term relief. However, external pressures and a weakening global outlook continue to pose risks to earnings and employment levels.
“The nominal average take-home pay was R17,310 in June 2025, showing a marginal 0.1% decline on May’s R17,325. However, this was still notably above the R15 514 level a year earlier,” said BankservAfrica head of Stakeholder Engagements, Shergeran Naidoo.
Despite recent volatility, the first half of 2025 suggests that the year may still deliver relatively strong salary performance. Real take-home pay, adjusted for inflation, slipped slightly by 0.2% month-on-month to R14,804 in June, down from R14,827 in May—but still meaningfully higher than a year ago.
“The significant moderation in consumer inflation during 2024 has had a positive impact on the purchasing power of salary earners and the scenario is continuing into 2025, with the latest headline CPI figure at only 3% for June 2025,” said independent economist, Elize Kruger.
After several difficult years marked by sluggish growth and high inflation, 2024 turned out to be the best year for salary earners since 2015, delivering an average real salary increase of 1.5%.
“With inflation forecast to average 3.5% in 2025 – unlike 4.4% in 2024 – and the broader industry suggesting an average salary increase above 5%, 2025 will be the second consecutive year of a real increase in earnings,” said Kruger.
The favourable inflation trend has not only helped to support household spending but has also given the South African Reserve Bank room to ease monetary policy.
“Carpe Diem Research Services forecasts a 25bps cut at the Monetary Policy Committee meeting tomorrow, 31 July 2025,” said Kruger. She added: “This is likely to be the final cut in the current downward cycle.”
Consumer spending has remained resilient despite ongoing volatility. Real final consumption expenditure by households was 2.8% higher year-on-year in Q1 2025, and early indicators suggest this momentum continued into Q2. Stats SA data shows real retail sales rose by 4.3% in the first five months of the year.
Still, the broader economic landscape has grown more uncertain. Recent months have seen downward revisions to both domestic and global growth forecasts, a slump in business confidence, and delays in investment decisions—factors that could weigh on job creation and income growth in the months ahead. South Africa’s unemployment rate remains stubbornly high at 32.9%.
Additional pressure stems from geopolitical tensions and trade uncertainty.
“As such, it remains of utmost importance that the South African government prioritise its diplomatic engagement with US authorities to negotiate a favourable trade regime, to avert job losses in sectors, such as automative and agriculture, which would otherwise face severe impacts,” said Kruger.
