Wealth

The salary gaps between Joburg, Cape Town and Durban are shrinking

Staff Writer

 ·10 Sep 2017

It has been well-established that people working in the economic hub of Johannesburg get better salaries than their counterparts in other big metros in South Africa – but salary trends show the gap between the average salaries in the country’s three major metros is shrinking.

The 2017 CareerJunction Salary Survey showed that, of all sectors covered by the report, Joburg employees consistently earned higher than the national average in all job sectors – while Cape Town and Durban earned well below this average in most industries.

However, looking at salary trends over the past four years (since 2014), it’s also clear that the dynamics in the job market are changing, and the gaps between Joburg, Cape Town and Durban salaries are narrowing.

Looking at CJ’s salary trend data, across all sectors the average salary differences between Joburg and Cape Town has narrowed by over nine percentage points since 2014.

Taking all sectors into consideration, in 2014 the average Joburg salary was 8.6% higher than the national average, while the average Cape Town salary was almost 12% lower – a gap of 20.5 percentage points. By 2017, this gap narrowed to 5.2% higher than the national average for Joburg, versus Cape Town’s 6% lower (a gap of only 11.3 percentage points).

A similar trend is seen between Joburg and Durban, where the gap between average salaries narrowed by over six percentage points.

In 2014, Durban’s average salary across all sectors was 12.3% lower than the national average – by 2017 this had narrowed to just under 9.5%. The gap between Joburg and Durban narrowed from 21 percentage points to a gap of 14.7 percentage points.

Breaking down the data further, we’re able to see how these margins have narrowed or widened across various sectors to track the growing or shrinking demand for jobs in different industries.

In ICT, for instance, salaries in Joburg have remained relatively stable in their band moving from 1% higher than national average in 2014, to 1.5% higher in 2017.

Cape Town salaries in the sector have moved from 2% below national average in 2014, to the same levels as Joburg at 1.5% above average.

In Durban, however, ICT jobs pay far less, where the average has dropped from 9% below average in 2014 to 22% below average in 2017.

The table below outlines the sectors where average salaries have increased/decreased over the years, by region.

Gauteng/Joburg

In Joburg, admin, office and support jobs have suffered the biggest salary decline since 2014. While the average job in this sector still pays 7.5% more than the national average, it is way down from the 35% seen in 2014.

Other sectors that have seen a narrowing margin are engineering jobs, finance jobs and manufacturing jobs.

Sales and warehousing jobs, on the other hand, have seen the biggest climb in averages.

Western Cape/Cape Town

In the Mother City, most job sectors have improved their average pay relative to the national average, though only three sectors – admin, sales and ICT – pay above that average.

Admin jobs saw a big 14 percentage point climb from paying 11% under the national average in 2014, to paying 3% above average in 2017.

Engineering and sales jobs both narrowed their margins relative to the national average by around 13 percentage points.

The opposite happened in the building and construction industry, where jobs in this sector paid 1% higher than national average in 2014, but paid 10.5% below average in 2017.

KZN/Durban

Durban has consistently paid below national average over the years, though has seen two industry shifts. In the admin, office and support sector, where Durban got a regional salary 7% higher than the national average in 2014, this has dropped to 13.5% below average in 2017.

Conversely, engineering jobs in the region which were paid 9% below average in 2014, now get paid 1.5% higher than average in 2017.

Jobs in finance and marketing have seen a big climb in average salaries paid relative to the national average, while ICT has seen a big drop in the opposite direction.

Read: Biggest salary increases in South Africa: 2016 vs 2017