Salary data reflects average pay in SA
BankservAfrica index reveals year-on-year salary decrease.
The BankservAfrica Take-home Pay Index (BTPI) which measures the average South African salary, reveals that the average real take-home salary for February 2022 decreased by 4.1 percent to reach R15,517 on a seasonally adjusted basis, and on a nominal basis, the average take-home pay was 1.3 percent, up at R16,022.
The February data further reveals that the overall take-home totals paid into all the bank accounts of employees increased by 0.6 percent.
February 2022 was the first time since September 2019 that the total monthly equivalent payments increased to over four million again. The report states that while this data is very volatile, it suggests that most, but not all of the employment from the Covid-19 shock has recovered.
BankservAfrica adjusted the CPI basis in the BTPI to the new changes by Statistics South Africa, which came into effect in February 2022, which means that the real salary is linked to December 2021.
BankservAfrica states that while the BTPI focuses more on the average salary, the report also points out that after the double-digit declines in the casual and weekly wage data estimates for a long period, both these salary bands have now had double-digit growth on a year-on-year basis. Thus, the actual decline in the average real take-home pay signals a return to work for the more vulnerable groups of lower-paid employees.
Shergeran Naidoo, BankservAfrica’s Head of Stakeholder Engagements says the average private pension, as tracked by BankservAfrica, increased by 0.5 percent in real terms to R9,667. This index has also been adjusted to the base period in December 2021, per the CPI base change.
The number of private pensions banked via this system remains relatively stable at around the 650,000 mark.
The seasonally adjusted nominalised private pension in South Africa, as measured by BankservAfrica, was R9,821 following a 6.2 percent year-on-year increase.
BankservAfrica notes that the current war between Ukraine and Russia has also impacted major commodity prices from oil to wheat prices which will impact inflation in South Africa and globally. As most salary agreements conclude retrospectively, take-home pay will take a while to catch up to these developments.
The report says the higher inflation rate and the crisis in Ukraine has led to soaring oil prices. Although household borrowing among South Africans has eased to below the inflation rate, the recently announced Reserve Bank interest hike could lead to higher mortgage repayments.
Together with the escalating food prices and rising fuel costs, this could put South African salaries under even more pressure, BankServ says.