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- Consumers are earning as much as they used to before the Covid-19 pandemic.
- More people are getting casual employment, too, especially in the past December.
- But fewer people are receiving salaries than before the pandemic.
Consumers are back to receiving pre-pandemic levels of real income.
According to the latest BankservAfrica Take-home Pay Index (BTPI), the average salary in South Africa increased at its fastest rate since the pre-pandemic in January 2022.
In January, the average take-home pay increased by 13% in nominal terms to reach R17 410. Even in real terms, take-home pay in the country was still up 6% after accounting for inflation, and it was up 10.2% from December 2021.
"The January payments also contributed to the median salary rising to its highest level since February 2021," said BankservAfrica in a statement.
But the January numbers need a little bit of digging into.
According to BankservAfrica, what caused the double-digit rise was the fact that there were many casual workers in December 2021 who dragged the average take-home pay down that month. So, the January increase is coming from that low base.
That said, the economy is recovering.
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Evident recovery
Last December saw businesses employ more casual workers than they have in a long time. BankservAfrica, which is the largest automated payments clearing house in Africa, observed that payments were made to an estimated 190 000 casual workers in December. This was "far above the norm", it said.
"This number of payments made to casual workers in December was the highest in 33 months," said Mike Schüssler, the chief economist at economists.co.za.
"The extra weekly payments in December are a good indication that some of the previously impacted industries were able to resume business over this period," he added.
In January, payments to casual workers slowed down to an estimated 112 000. The drop in the number of casual workers paid in January increased the average take-home pay, which is why SA recorded a double-digit jump.
But even after normalising for that once-off impact, BankservAfrica said the January typical take-home pay increased by 3.2% in real terms.
The only sector that suffered January blues was private pensions. Real average private pensions in the country declined by 0.5% on a year-on-year basis to R9 465.
But that still didn't affect the country's overall take-home pay much. The total amount paid to South African employees and private pensioners increased by a nominal 8.9% year-on-year.
The real total money paid for salaries and pensions increased in September and December 2021 and now again in January 2022.
"The overall payments are clear indications for the macroeconomy that consumers are back to receiving pre-pandemic levels of real income," said Schüssler.
However, he pointed out that fewer people are receiving salaries and private pensions now than before the pandemic. BankservAfrica said the decline in monthly payments made to workers is becoming more apparent. Retrenchments and salary payment reductions persist in certain industries, like airlines and hotels.
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