\u201cJune is the second consecutive month that nominal salaries have remained below the R15,000 mark and 1.8% lower compared to a year ago.\u201d<\/p>\n
In four of the past seven months, there has been negative year-on-year growth for nominal wages. The rising inflation rate, which Stats SA reported hit a 13-year high of 7.4% for June last week, spells trouble for the average salaried worker, he said.<\/p>\n
\u201cAligned with global trends, local consumer inflation increased to a 13-year high of 7.4% y\/y in June, from 6.5% y\/y in May, running notably ahead of wage increases in the economy and as such having a meaningful negative impact on South Africans\u2019 purchasing power.<\/p>\n
“This is reflected in a notable 7.8% y\/y drop in the real salaries recorded in the BTPI,\u201d said independent economist Elize Kruger.<\/p>\n
\u201cWith consumer inflation forecasted to increase further in July, before reaching an upper turning point, more pressure can be expected on consumers and the economy at large.\u201d<\/p>\n
The BTPI shows more people receiving salaries compared to a year ago. After adjusting for weekly workers, the BankservAfrica data indicates that about 300,000 more salaries were paid in Q2 2022 compared to Q1 2022 (+370K new employment opportunities in Q1).<\/p>\n Pensions<\/strong><\/p>\n The BankservAfrica Private Pensions Index (BPPI) showed that the average nominal private pension reached R10,000 per month for the first time, representing a 9.1% growth on a year-on-year basis, according to Naidoo. In real terms, the average real private pension was R9,673 per month, 1.5% higher than a year earlier.<\/p>\n Although there were monthly real declines recorded in three of the past six months, average real pensions have held up reasonably well despite rising inflation. The total take-home pay and private pensions processed in value terms increased by 4.8% in real terms and by 12.6% in nominal terms, not seasonally adjusted.<\/p>\n With ever-increasing pressure on the disposable income of households, consumer spending, which contributes about 63% of South Africa\u2019s GDP, is likely to falter in the coming months.<\/p>\n The sources of higher inflation, specifically higher food, fuel and administered prices are still in a relentless upward trend and unlikely to abate in the short term, while the risk of second-round effects on the consumer basket is on the rise, said BankservAfrica.<\/p>\n Consumers will have to brace themselves for an average headline CPI of around a forecasted 7% in the second half of 2022, which will further erode purchasing power. As such, more real declines in average salaries can be expected in coming months, it said.<\/p>\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/07\/BankServAfrica.png\")
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