Changes coming to 2025 South African National Minimum Wage
Now is your chance to weigh-in on the 2025 South African National Minimum Wage. A National Minimum Wage (NMW) commission setup by the Department of Employment and Labour is asking for submissions on the topic by the end of September 2024. Moreover, the commission said it will publish its annual report before the end of the year with recommendations for the 2025 South African National Minimum Wage, reports Business Tech.
2025 SOUTH AFRICAN NATIONAL MINIMUM WAGE
The 2025 South African National Minimum Wage has been hotly debated in the lead-up to the department’s report. According to latest research by the University of Cape Town (UCT), government needs to consider the ‘real’ South African living wage when it considers 2025’s minimum one. The former has been calculated at R15 000 per month as the lowest income for families to live a ‘decent’ life. Currently, the legally prescribed national minimum wage comes to only one third (roughly R5 378) of the aforementioned living wage.
Compounding the issue is South Africa’s worsening unemployment rate in 2024. While economic powerhouses elsewhere in Africa – the likes of Egypt, Morocco and Nigeria – are predicting GDP growth upwards of 3%, South Africa’s is expected to stay flat at just 1%. The largest portion of the country in its history is economically inactive, 42.6% of the greater population, which is a 0.7% increase compared to the start of 2024. Many of these non-tax-contributing residents rely solely on South African Social Security Agency grants and informal work to survive.
HAVE YOUR SAY
All interested parties are welcome to submit their input on the 2025 South African National Minimum Wage before Monday 30 September 2024. Recommendations must be sent to:
- Employment Standards, Department of Employment and Labour, Private Bag X117, Pretoria, 0001
Written representations will be forwarded to the Minister of Employment and Labour together with the Commission’s report.
Encouragingly, the commission has already committed to above-inflation hikes each year, so the increases don’t lose value. Back in May 2023 it released a medium-term target with a three-year goal. The commission has also said the 2025 South African National Minimum Wage will go hand-in-hand with economic indicators .
WHAT ECONOMIC INDICATORS ARE AT PLAY?
- Inflation.
- Cost of living.
- Wage levels.
- Collective bargaining outcomes.
- Gross Domestic Product (GDP).
- Small, medium and micro-enterprises (SMEs).
- Unemployment and new job creation.
The national minimum wage of R25.42 per hour increased to R27.58 per hour in March 2024, according to the CCMA. This adds up to R1 241 per week (45 hours) and R5 378 per month (195 hours).
IS THAT ENOUGH TO LIVE ON IN SOUTH AFRICA?
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