How much money gold, platinum and coal miners get paid in South Africa

The South African Chamber of Mines has released its annual fact book, providing detailed information on the country’s mining sector, including how much mine workers were paid in 2016.

The South African mining sector is disheveled following the release of the latest mining charter by mineral resources minister, Mosebenzi Zwane, last week.

The new charter, which demands that mines be 30% black-owned (up from 26% previously), has been widely lambasted by the industry, with businesses pushing back calling the regulations unfair, and the process in publishing them, irregular.

Of main concern is that the charter does away with historic “once empowered, always empowered” rule. Previously, if a mining company had black shareholders that met the 26% ownership requirement, who then sold off that shareholding, the empowerment deal would still carry through. This is no longer the case.

These drastic changes have caused anger, uncertainty and doubt in the sector, and has already wiped R50 billion from the industry, as investors divest.

The controversy comes as South Africa’s mining sector started showing signs of recovery, following an extremely difficult 2016.

According to the SA Chamber of Mines, the country’s mineral resources sector has faces a lot of volatility over the past few years – between fluctuations in the wider economy (spurred by political uncertainty and global events), labour issues and now policy and regulatory uncertainty.

One of the biggest hammers to fall against the industry are widespread worker strikes – typically over wage disputes.

Labour issues in the mining sector have been a long-standing issue, with strikes leading to mines being shut down, and in the case of Marikana, tragedy and bloodshed.

How much miners earn

The mining sector remains one of the biggest employers and GDP contributors in South Africa, though both of these metrics have been in decline in recent years.

In 2016, the mining industry directly contributed R304 billion to South Africa’s GDP. In nominal terms, this was up 7.2% from 2015 – but in real terms (at 2010 prices) this contribution was down 4.7% year-on-year.

In terms of employment, mine workers account for 7.3% of all private non-agricultural jobs (and 5.4% of all formal, non-agricultural jobs), with 457,332 workers employed. This is down 4.% from 2015, and down significantly from the height of 524,632 workers employed in 2012.

The entire sector made total sales of R458,5 billion in 2016 – earning R698,017 per worker (R58,168) per month.

Workers earned a total of R120.1 billion in salaries in 2016, equating to an average of R262,553 per worker (R21,879 per month).

There are more platinum group metal (PGM) miners than any other commodity, having moved far past gold mining, which used to be the largest employer until 2005. However, when it comes to earnings, iron ore miners get paid the highest average.

The table and graphs below show how mine workers are paid across each commodity.

Commodity Employed Total remuneration (R’000) Average per worker Average monthly salary
Iron ore 16 490 R5 878 117 R356 466 R29 705
Manganese 7 240 R2 117 702 R292 500 R24 375
Coal 77 506 R21 092 895 R272 145 R22 679
Chrome 15 514 R4 207 698 R271 219 R22 602
PGMs 172 444 R45 876 264 R266 036 R22 170
Diamonds 17 978 R4 769 876 R265 317 R22 110
Gold 116 479 R28 731 311 R246 665 R20 555
Aggregate and sand 7 602 R1 190 424 R156 594 R13 049

Image credit: De Beers

Read: New mining charter unsettles investors, wipes R50 billion from the sector: report

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