Things are looking up for employed South Africans
An increasing proportion of employed South Africans are continuing to extend their financial resilience through proactive measures, resulting in increasing optimism that their financial situation and the economy will improve in the near future.
This is the result of South Africans taking more proactive steps for their financial future, including expanding revenue sources, improving debt management, practising prudent budgeting, and increasing savings.
These are some of the findings of the recently published Old Mutual Savings & Investment Monitor (OMSIM) 2024 study.
Now in its 15th year, the OMSIM surveyed employed South Africans aged 18 to 65, earning a personal monthly income of over R8000. This demographic makes up around 24% of the nation’s adult population.
It seeks to portray the financial attitudes and behaviour of working South Africans, painting a “picture of how employed South Africans are extending their resilience,” said Old Mutual.
“This year’s findings reveal a significant shift in the financial attitudes and behaviours of working South Africans – a clear demonstration of their evolution from mere resilience to remarkable resourcefulness and financial savviness,” they added.
Financial situation outlook
According to the survey, 68% of respondents believe that their financial situation will improve in the next six months.
The 68% is slightly lower than the 71% recorded last year, however 29% higher than the 39% in 2017.
They cited various reasons for optimism of improvement, including proactive steps:
- Expanding revenue sources through a second job/starting a business/side hustle;
- Managing debt better;
- Budgeting better;
- Saving more.
This is also reflected in decreased financial stress levels. According to the OMSIM, an estimated 37% of working South Africans are highly financially stressed, although high, is down from 58% in 2020.
The company attributes this to the “resourcefulness and adaptability that characterises South Africans.”
The proactive measures towards increasing financial security has meant that the country has seen a rise in “PolyJobbers: – those who juggle side hustles, freelancing, and afterhours work alongside their regular jobs.
Across age groups, 57% consider themselves PolyJobbers, a 10% increase from 2021.
The youth (aged 18 to 29) show the highest prevalence of polyJobbing (73%), according to the study.
Additionally, entrepreneurship is on the rise, with an estimated 47% of employed South Africans owning a business, up from 44% in 2023.
“This entrepreneurial spirit extends across all age cohorts, fuelling a surge in business-related savings goals, with a third of individuals saving to start or finance a business, up from 27% in 2023,” said Old Mutual.
This “highlights how South Africans are not only resilient but also innovative, taking proactive steps to improve their finances by reducing their reliance on debt, being more entrepreneurial and increasing their income streams,” said Vuyokazi Mabude, Head of Knowledge and Insights at Old Mutual.
“This shift in mindset is truly inspiring. It shows that, despite the challenges, South Africans are finding ways to thrive and navigating their financial journeys with optimism and determination,” she added.
The study also highlights that since the 2020 Covid-19 pandemic, there has been some level of stabilisation of levels of financial satisfaction (although evidently below being financially satisfied).
The study places the average working South African at 6.5 on a scale of 1 to 10 (where 1 is hopelessly dissatisfied and 10 is extremely satisfied).
“While consumers indicate they are getting by, they do acknowledge there is further room for improvement,” said Old Mutual.
However, those who do not believe that their financial situation will improve in the next six months (making up 32%) cite various reasons, including:
- A belief that cost of living going to get worse/ inflation/economy “not looking good”;
- Their work situation is stagnant;
- Deteriorating income.
The over two-thirds optimism about an improving financial situation has resulted in an improved (although still low) country outlook.
Over 1 in 3 (36%) working South Africans express confidence in the country’s economy – an upturn of 9% since the low of 27% in 2023.
The OMSIM said that the largest drivers of low confidence is that of governance (particularly service delivery) issues, a poor performing economy, rand depreciation, high cost of living/inflation as well as alarmingly high levels of unemployment.
Looking at income levels, 38% of working South Africans report earning more than what they earned a year ago, while 43% report earning the same.
Around 1 in 5 working South Africans, however, report earning less than they did a year ago.
Additionally, the study outlines the top seven financial priorates working South Africans have listed, which include:
- Income/Job security;
- Cutting expenses;
- Paying debt;
- Emergency savings;
- Investments are secure;
- Getting best investment returns;
- Helping family financially.
The full report can be found here.
Read: Perfect storm hitting South Africans earning more than R20,000 per month
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