South Africans are seeing their pay packets grow, but the relief is uneven. Average net salaries climbed for the sixth straight month in September 2025.
Yet a third of the workforce remains unemployed, leaving many still struggling to make ends meet.
“The PayInc Net Salary Index reached R21 428, which was 0.3% up on August’s level and 2.3% higher than a year ago,” says Shergeran Naidoo, Head of Stakeholder Engagements at PayInc.
This is on a nominal level, which includes the effects of inflation.
Across the first nine months of 2025, average net salaries rose 4.3% compared to the same period in 2024, with just over 175 000 additional salaries disbursed.
The PayInc Net Salary Index tracks the average nominal net salaries of approximately 2.1 million earners in South Africa.
But high unemployment casts a shadow over these gains.
“While a welcome development, the official unemployment rate remains stuck at around 33%, as the economy, at current sluggish growth rates, is simply unable to create enough new opportunities to absorb all new entrants into the job market on an annual basis,” says Elize Kruger, independent economist.
The third quarter offered further signs of labour market resilience. Average net salaries rose 0.4% quarter-on-quarter, while roughly 48 000 more salaries were paid.
“The refreshed PayInc Net Salary Index confirms the narrative that 2025 will on average be a good salary year, despite uncertainties and challenges impacting the economic outlook,” says Kruger.
Even with average consumer inflation at 3.1% for the first nine months of 2025, real net salaries are up 1.2% compared to 2024.
However, September marked the third consecutive month that real wages – adjusted to remove inflationary effects – remain below year-ago levels.
Kruger is optimistic.
“With average consumer inflation forecast at 3.3% in 2025 – lower than the 4.4% in 2024 – and industry data suggesting an average salary increase above 5%, 2025 will likely be the second consecutive year of a real increase in earnings,” says Kruger.
Kruger adds that “this is a welcome tailwind for salary earners, supporting consumption expenditure and could assist in softening the impact of global headwinds on the local economy”.
However, Investec chief economist Annabel Bishop cautions that “the distorting effects of inflation give a false picture on the consumers purchasing power based on their disposable income”.
Kruger notes that an average salary increase of around 5% could boost spending, it will only be sustainable if productivity growth keeps pace.
Income patterns also show structural trends, according to the Bureau of Market Research (BMR).
Around 3% of adults rely on investments or pensions as their main income sources, yet together they captured nearly a third of the total rand increase in income over the decade, said BMR.
BMR said education remains important, with secondary and tertiary qualifications linked to higher earnings, but younger cohorts still face weak wage growth.
Age and asset exposure now outweigh education as predictors of income growth, BMR noted.
With unemployment at 33.2% in 2025, wage progression and labour absorption remain limited, leaving many workers dependent on incremental salary gains to stay afloat.
Business
