While it would appear that the average nominal salary has stabilised somewhat in the past two months, it has also become evident that salaries have lagged behind the average headline inflation in 2022.<\/p>\n
\u201cIn line with expectations, consumer inflation moderated somewhat off the 13-year high of 7.8% reached in July, to 7.5% in September, but remains at elevated levels,\u201d said independent economist Elize Kruger.<\/p>\n
This moderation was driven by lower fuel prices. However, the higher food prices and a broader-based upward pressure evident in the consumer basket\u2019s prices offset the impact. The South African Reserve Bank hiked the benchmark interest rate by a cumulative 275bps since November 2021 and has signalled that more hikes are on the cards.<\/p>\n
Growth in nominal BTPI vs headline CPI<\/strong><\/p>\n \u201cThe average salaried person\u2019s finances are likely to remain strained as reflected in the 8.3% y\/y decline in the real average salary recorded in the BTPI in September. However, as we forecasted that July\u2019s 7.8% headline CPI print would be the upper turning point of the current inflation cycle, the pressure should start to alleviate slightly as inflation moderates towards year-end. We forecast inflation could be at around 7.2% by year-end,\u201d said Kruger.<\/p>\n Worryingly, the BTPI data shows less salaries were paid in September. Adjusted for weekly payments, BankservAfrica\u2019s BTPI data suggests job losses occurred in September as the number of salaries paid declined after five consecutive months of growth between April – August 2022.<\/p>\n The economy has buckled under the pressure of higher load shedding levels, which has led to companies and employers experiencing ongoing hardship. Over and above the prolonged energy supply problems are the elevated input costs, rising interest rates and increasingly higher wage demands placing downward pressure on company profits and margins.<\/p>\n Furthermore, the less favourable global economic backdrop has amplified the economic challenges of many sectors, BankservAfrica said.<\/p>\n BankservAfrica\u2019s estimate of the number of people receiving salaries (R100K per month)<\/strong><\/p>\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/10\/BankservAfrica.png\")
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