The average salary in July did not change compared to the same period a year ago, the BankservAfrica Take Home Pay Index (BTPI) showed.
THE AVERAGE salary in July did not change compared to the same period a year ago, the BankservAfrica Take Home Pay Index (BTPI) showed.
BankservAfrica’s head of stakeholder engagements, Shergeran Naidoo, said that in July the real average salary was R12 129, which was only R2 more than the salary in July last year.
“This is, however, R383 down from the June 2021 average pay of R12 512,” said Naidoo.
However, as indicated in previous BTPIs, the average salaries during the height of the Covid-19 first wave last year were higher than usual. Higherpaid full-time employees did not suffer the same level of pay reductions as lower-paid casual workers, who bore the brunt of the cost-cutting measures at that stage.
Economists.co.za chief economist Mike Schüssler said despite the looting and rioting in July, as well as the tougher lockdown, the monthly equivalent number of payments declined by less than -0.1 percent and by -R1 092 in value from June.
Also influencing the July figure was the decade low that the BTPI reached in July last year because of the Covid-19 crisis. To illustrate the extent of this, the number of working people increased by 41 percent in July this year because July last year was the lowest point of the Covid crisis.
“Herein is the lesson, and that is employment and salaries lag economic and political events on the ground. Last year, during the level 5 lockdown, the number of people paid did not change during April 2020; the falling numbers only became apparent in June and July 2020,” said Schüssler.
The likely reason was that employers and employees had a contractual relationship for salaried payments.
Payment companies contracted by employers often received the salaries upfront from their clients to pay everything, from taxes to garnishee orders. The payment companies’ income was made up of the money kept in the bank for a month or so.
He said as seen last year, when the employment and pay impact took about two months to show up in the data, they expected the job losses or the temporary non-payments from the looting and rioting to show in the BTPI data in the next month or so.
“Overall, our July 2021 BTPI shows that salaries are indeed a lagging indicator – even for retail sales. However, as the BankservAfrica data publishes before retail sales, it does give useful insights into the forthcoming retail releases,” said Schüssler.
For the ninth month in a row, average real pensions rose at double the inflation rate, according to the BankservAfrica Private Pensions Index (BPPI). Inflation increased by 4.6 percent in July compared to a year ago. However, pensions after inflation rose by 5.6 percent.
“The real average private pension was R7 717 for July 2021, while the nominal private pension value was R9 250,” said Naidoo.
According to the BPPI, in the past nine years, the average number of pensioners a month was 665 000. However, this figure had dropped to 640 000 in the past three months. The number of private pensioners was now below the nine-year average.