What South Africans are earning on average right now

The BankservAfrica Take-home Pay Index (BTPI) tracked lower in April 2024 - however, it remained above year-ago levels.

“The nominal average pay fell below the R16 000 mark experienced over the past two months to R15 374 in April. The good news is that this figure is still 5.6% up on a year ago levels,” said Shergeran Naidoo, BankservAfrica’s Head of Stakeholder Engagements.

The average real take-home pay, adjusted for inflation, also tracked lower at R13 566 in April though marginally up on a year-on-year basis.

A comparison of the average nominal BTPI for the four months to April to the corresponding period one year earlier revealed a 6.0% improvement and 0.6% in real terms.

“If sustained throughout the year, 2024 could turn out to be a better year for salaries, unlike 2023 when the average BTPI increased by only 1.2%,” said Elize Kruger, Independent Economist.

With no load shedding over the past two months, the business environment has improved, enabling organisations to increase productivity and lower the cost of production.

An improved business environment will positively influence companies’ ability to pay inflation-related salary increases in 2024.

Year to date, BankservAfrica data aligns with the South African Reserve Bank’s forecast of an average salary increase of 6.1% for 2024.

With average consumer inflation likely to be around 5.1% in 2024, a forecast real increase of 1.0% in average wages could bode well for economic activity this year.

According to the BankservAfrica BTPI data, about 132 000 more salaries were paid in April 2024 compared to the previous month.

With South Africa’s unemployment rate at around 33%, any improvement in the job market is welcomed.

The elections on 29 May could give rise to a notable increase in casual workers, typically paid on a weekly basis, the financial services company said.

In three of the past four elections, the increase in the estimated number of people receiving weekly salaries during the election month was around 48 000 – 65 000.

Pensions

The BankservAfrica Private Pensions Index (BPPI), tracking the pension payments to about 700 000 pensioners, ticked lower in both nominal and real terms in April 2024, but remained comfortably above year-ago levels.

“The average nominal private pension moderated to R10 639 in April 2024 compared to the previous month’s R10 745, still 6.6% higher than a year earlier. Similarly, in real terms, the average BankservAfrica BPPI increased by 1.2% in April 2024, compared to a year earlier, sustaining its ongoing track record to beat inflation,” said Naidoo.

The cumulative value of total take-home pay and private pension payments processed by BankservAfrica in April 2024, which indicates the overall spending ability in the economy, increased by 5.3% in nominal terms but slipped marginally in real terms, compared to a year earlier on a non-seasonally adjusted and smoothed basis.