This is up 4.9% from R17,246 in December 2024 and up 16.3% from R15,564 in January 2024.<\/p>\n\n\n\n
In real terms, accounting for inflation, take-home pay also increased to R15,659 in January 2025<\/strong>, a notable 12.8% increase from January 2024.<\/p>\n\n\n\n Pay has reached its highest level since February 2022, BankservAfrica noted.<\/p>\n\n\n\n This is largely thanks to the significant moderation in consumer inflation during 2025, which moved from 5.3% in January 2024 to 3.0% in December.<\/p>\n\n\n\n Lower-than-expected inflation has had a positive impact on salary earners’ purchasing power.<\/p>\n\n\n\n Shergeran Naidoo, BankservAfrica\u2019s Head of Stakeholder Engagements, said that the upward trend in average salaries started in early 2024 and, despite some volatility, looks set to continue.<\/strong><\/p>\n\n\n\n Independent economist Elize Kruger said the positive trend also reflects a generally improved business environment and higher confidence levels in the economy.<\/p>\n\n\n\n Three interest rate cuts in September 2024, November 2024 and January 2025 have also gone a long way in providing relief.<\/p>\n\n\n\n Company profitability also improved during 2024, as reflected in the above inflation increase in the gross operating surplus of companies. <\/p>\n\n\n\n The improving environment was also echoed in the sizeable total return on the FTSE\/JSE All Share Index in 2024 (+13.4%), reflecting the promising earnings potential of listed companies.<\/p>\n\n\n\n The recovery in disposable income has been seen in healthier retail sales (up 2.5% year-on-year) and improved passenger car sales (up 1.1%). <\/p>\n\n\n\n This would have also been supported by Two-Pot retirement withdrawals, Kruger noted.<\/p>\n\n\n\n Overall, real take-home pay averaged R14,292 in 2024, up 3.1%, representing the first real increase in take-home pay since 2020. This puts South African salary earners on good footiong for the year ahead.<\/p>\n\n\n\n Assuming that inflation will remain well-contained in 2025\u2014with the average headline CPI forecasted to be at 4.2%\u20142025 could be the second consecutive year of positive real take-home pay growth<\/strong>, Kruger said.<\/p>\n\n\n\n The economic outlook indicates that the salary gains seen in 2024 could continue to strengthen.<\/p>\n\n\n\n On the economic front, real GDP growth is forecasted to increase by 1.7% in 2025, somewhat higher than in 2024. <\/p>\n\n\n\n The acceleration in growth will be driven by a combination of improved household consumption expenditures, higher fixed investment spending, and further advances in structural reforms. <\/p>\n\n\n\n An ongoing focus on improving South Africa\u2019s electricity generation capacity, addressing supply chain blockages relating to freight rail and port operations, and upgrading water infrastructure, among others, are much-needed actions to propel the economy forward.<\/p>\n\n\n\n \u201cThe anticipated improvement in the business environment is expected to enable companies to offer more substantial salary increases in 2025, which in combination with a moderate inflation environment, could mean a second consecutive year of a real increase in take-home pay,\u201d Kruger said.<\/p>\n\n\n\n There are risks to watch out for, however.<\/p>\n\n\n\n If the 2025 National Budget had been tabled with the 2% VAT increase, it would have derailed the positive inflation outlook somewhat, eroding the fragile recovery in the purchasing power of salary earners.<\/p>\n\n\n\n The budget is currently in the process of being reworked, but there is still no certainty on what the National Treasury will do to plug its funding gap.<\/p>\n\n\n\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2025\/02\/Elize-Kruger.jpg\")
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