{"id":787827,"date":"2024-08-22T12:00:00","date_gmt":"2024-08-22T10:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=787827"},"modified":"2024-08-22T11:55:01","modified_gmt":"2024-08-22T09:55:01","slug":"major-take-home-pay-boost-for-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/787827\/major-take-home-pay-boost-for-south-africa\/","title":{"rendered":"Great news for take-home pay in South Africa"},"content":{"rendered":"\n

Take-home pay in South Africa has improved dramatically over the last year, with another significant jump in July.<\/p>\n\n\n\n

The average nominal take-home pay measured in the BankservAfrica Take-home Pay Index (BTPI) improved significantly in July due to the better business environment and recovering confidence levels.<\/p>\n\n\n\n

\u201cThe average nominal take-home pay reached R16,358 in July, increasing by 5.9% on a year-on-year basis,\u201d said Shergeran Naidoo, BankservAfrica\u2019s Head of Stakeholder Engagements.\u00a0<\/p>\n\n\n\n

In real terms, salaries adjusted for inflation increased by 0.9% year-on-year to R14,400 in July 2024.<\/p>\n\n\n\n

\u201cWhile not reflecting linear growth, take-home pay has so far surprised to the upside in 2024, reflecting an improved business environment,” said Elize Kruger, Independent Economist. <\/p>\n\n\n\n

“The reprieve from load shedding for almost five months, moderating inflation, a new political landscape, and the prospect of lower interest rates as soon as September have all provided a much-needed boost to confidence.” <\/p>\n\n\n\n

A comparison of the average nominal BTPI for the first seven months of 2024 to the corresponding period in 2023 showed a 6.6% increase. In real terms, there was an increase of 1.2% <\/p>\n\n\n\n

\u201cIf this trend is sustained for the remainder of the year, 2024 will likely be the best year for salaries since 2020, with the increase in average nominal BTPI beating inflation,” said Kruger. <\/p>\n\n\n\n

“Improved purchasing power will go some way to supporting cash-strapped household budgets.” <\/p>\n\n\n\n

The growth in take-home pay should not diminish South Africa’s extremely high unemployment rate. <\/p>\n\n\n\n

The unemployment rate increased in the first half of 2024, with 73,000 job opportunities lost compared to the end of 2023.<\/p>\n\n\n\n

The unemployment rate jumped from 32.1% in Q4 2023 to 33.5% in Q2 2024, the highest level in two years. <\/p>\n\n\n\n

It is also evident that the better outcome of salary increases has likely been detrimental to existing opportunities in some cases, with vast differences between different economic sectors apparent. <\/p>\n\n\n\n

\u201cThe South African economy urgently needs an enabling environment that could foster accelerated growth and drive much-needed job creation,\u201d said Kruger.  <\/p>\n\n\n\n

Progress made in the first phase of Operation Vulindlea to accelerate structural reforms and boost economic growth has already boosted confidence. <\/p>\n\n\n\n

The first phase has already fast-tracked reforms that have accelerated the roll-out of privately owned energy generation capacity, laid out plans to remedy the country’s failing freight lines and ports, and outlined an approach to unblocking the work permit system. <\/p>\n\n\n\n

The second, with the support of the GNU, will focus on reviving municipalities and addressing issues related to housing, public transport, and digital infrastructure. <\/p>\n\n\n\n

These efforts should boost household and corporate confidence and economic productivity levels. <\/p>\n\n\n

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Pensions remain flat<\/strong><\/p>\n\n\n\n

Unlike the BTPI, the BankservAfrica Private Pensions Index (BPPI), which tracks the pension payments to about 700,000 pensioners, moderated in nominal and real terms in July 2024.<\/p>\n\n\n\n

\u201cThe average nominal private pension subsided to R11,180 in July 2024, unlike the previous month\u2019s R11,270. This was still 2.1% higher than a year earlier,\u201d said Naidoo. <\/p>\n\n\n\n

In real terms, the average BankservAfrica BPPI in July dipped 2.4% below a year earlier.<\/p>\n\n\n\n

That said, the average nominal BPPI for the first seven months of 2024 showed a 5.2% increase compared to the corresponding period in 2023. The real BPPI remained flat compared to the same period in 2023.<\/p>\n\n\n\n

\u201cThese movements suggest that average private pension payments have managed to stay on track with the average inflation so far in 2024,\u201d said Kruger.  <\/p>\n\n\n\n

The pension industry is in sharp focus due to the implementation of the two-pot retirement system on 1 September 2024. <\/p>\n\n\n

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Read<\/strong>: Tax warning for anyone withdrawing from the two-pot system<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

2024 looks set to be a strong year for take-home pay, but intervention is needed to address South Africa’s sky-high unemployment. <\/p>\n","protected":false},"author":95,"featured_media":645739,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[1976,26],"class_list":["post-787827","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-bankservafrica","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/787827","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=787827"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/787827\/revisions"}],"predecessor-version":[{"id":787840,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/787827\/revisions\/787840"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/645739"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=787827"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=787827"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=787827"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}