The average take-home pay in South Africa right now

The average monthly take-home pay in South Africa saw a significant increase of 13% in September, largely due to government wage increases and backdate payments. However, this increase is likely to be short-lived, the latest BankservAfrica Take-home Pay Index (BTPI) shows.

As a consequence of these contributing factors, the nominal average BankservAfrica take-home pay reached R15,794 in September 2021. In real terms, the average salary was R13,047, which was 8.3% higher on a year-on-year basis.

“All these factors indicate that the average take-home pay will not increase at September’s rate in the next month or so,” the group said.

“The worldwide supply chain issues and the shock from July’s unrest are likely to constrain economic growth and affect salary increases. We expect a downward adjustment in salaries in the coming months.”

Government increases

The latest salary data held over 800,000 extra payments, mostly from government departments.

These reflect the delayed implementation of the Public Service Co-ordinating Bargaining Council’s salary adjustment for civil servants for a cash allowance that is payable backdated from 1 April 2021 to 31 March 2022.

“We believe the extra payments represent two payments – one for backdated payments and one for the most recent month’s increase,” BankservAfrica said.

“Civil servants receive a cash allowance of at least R1,000 per month (based on a sliding scale). As these backdate to April, our data showed 400,000 payments were made for the period April to August. According to our data, another 400,000 payments were made in September 2021. These contributed 80% of the increase in September’s take-home pay data.”

BankservAfrica also noted that overtime pay was made to the South African Police Service (SAPS) and the South African National Defence Force (SANDF) for their extended duty during July unrest, which added almost R1 billion to the BTPI’s overall salaries.

Therefore, the overtime pay pushed up the average take-home pay in the BTPI. Overtime pay on this scale is unlikely to occur again any time soon, it said.

“The third factor was the low base for the take-home pay in September 2020. Last year, when the economy began recovering, more casual employees – whose jobs were affected during the worst of the Covid-19 crisis – gradually returned to the workplace. As a result, the average take-home pay lowered from time to time during 2020.”

Read: Every rand spent on South Africa’s new basic income grant will be an extra rand of tax

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The average take-home pay in South Africa right now