The cost of living reality for South Africa

 ·12 Apr 2024

Basic living costs such as transport, electricity, and nutritious food are outstripping inflation in South Africa – and some households (especially those earning minimum wage) are simply not coping.

This was highlighted in the latest food basket data from the Pietermaritzburg Economic Justice and Dignity Group (PMBEJD), which showed that 28 out of its 44 basket items saw a year-on-year price increase.

Additionally, of the 28 items, 19 recorded double-digit growth year-on-year, reflecting significant increases – and seven were over 20%.

This is compared to CPI Food inflation, which was 6% as of February 2024.

Compounding the cost-of-living pressures are the recent 12.72% Eskom price increase effective as of April and the R2.30 accumulative petrol price increase since February 2024.

Eskom’s hike has pushed municipalities to draft similar double-digit increases for July, while early indicators show another petrol hike is on the cards for May.

Some households in South Africa may be able to absorb these above-inflation increases, but the PMBEJD has warned that the average worker earning the National Minimum Wage (NMW) – who are already struggling to cope – simply can’t.

The NMW is R27.58 an hour and R220.64 for an 8-hour day. In March 2024, with 19 working days, the maximum NMW for a General Worker is R4,192.16.

“The wage workers earn is not just to sustain themselves alone. It is used to support the entire family.

“For Black South African workers, one wage typically must support 3.8 people. Dispersed in a worker’s family of four persons, the NMW is reduced to R1,048.04 per person – this is below the upper-bound poverty line of R1,558 per person per month,” said the PMBEJD.

Considering this, the Group calculated that the March 2024 cost of a basic nutritional food basket for a family of four in South Africa is R3,694.62 – a 7.7% increase from last year.

Using Pietermaritzburg-based figures for electricity and transport and the average figure for a minimum nutritional basket of food for a family of four, the Group added that these costs take up 57.9% of a worker’s wage.

Food is bought after monies for transport and electricity have been paid for or set aside (leaving only R1,765.24 for food and everything else).

In March 2024, the PMBEJD calculates that workers’ families will underspend on food by a minimum of 52.2% (with R1,765.24 left after transport and electricity and food costing R3,694.62).

“In this scenario, it is unlikely that a worker will be able to afford enough nutritious food for their family.

“If the entire R1,765.24 went to buy food, then for a family of four, we are looking at R441.31 per person per month. This is below the food poverty line of R760,” it said.

Read: Expect more tough pricing news for South Africa next week

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