‘Formal sector workers have kept up with inflation rates’
Recent data shows the average South African salary grew just above the estimated rate of inflation.
JOHANNESBURG - BankservAfrica says formal sector workers have over the past four years kept up with inflation rates.
The latest Bankserv Africa Disposable Salary (BDSI) data shows the average South African salary grew just above the estimated rate of inflation with a 6.7% year-on-year growth recorded in May compared with the 7.3% y/y growth recorded for April 2016.
The data suggests the number of salary earners in the formal sector may be declining, but those that have kept their jobs have seen substantial increases.
The average take-home salary in May was R13,142, slightly above April's average of R12,877.
According to the report this higher monthly average trend is likely to continue due to the public sector wage increases.
Economist.co.za's Mike Schüssler says this proves that some of those who have jobs should be able to stay financially afloat.
"They haven't beaten inflation, they have kept up with it. That means they have been able to maintain their lifestyle. Whether that lifestyle was for a lower end worker a 'survival' type of lifestyle or for the middle class a comfortable lifestyle….by comfortable I mean you can pay your water and lights, bond, car, put food on the table and you have some extra left over for a braai."
While the increase in tax rates and medical insurance may take up much of the higher pay cheques, Schüssler says the pressure is really felt depending on an individual's financial commitments.
"People feel that they are just surviving because they have made a lot of commitments, you know they have bought that car and they are obviously wanting to hold onto it, they want to put their children thought the excellent schools… and I think a lot of people are saying 'we are treading water. We have not really gone ahead in being able to buy many new things if we haven't paid off old things."