Data published by the University of Cape Town (UCT) Liberty Institute of Strategic Marketing shows that more South Africans are struggling to make ends meet, as the country passes its 500th day in lockdown under the national state of disaster.
Using research from the National Income Dynamics Study – Coronavirus Rapid Mobile Survey (NIDS‑CRAM) surveys, the UCT Liberty Institute examined the impact on both jobs and income across the economic spectrum.
The group’s data shows that middle‑class and high-earning South Africans are under financial strain, earning salaries lower than before lockdown.
The average salary for those earning over R40,000 per month has declined. Even among those in low paying jobs – people earning less than R3,500 per month – average salary figures have dropped compared to pre-Covid levels.
Dr James Lappeman, the head of projects at the institute, said the figures suggest that the informal sector has been particularly badly hit by the pandemic.
“Without going into too much detail, there are limitations with the NIDS-CRAM data we used. In addition, analysts need to be aware that variables like net, gross, individual or household income will influence how comparable data sets are.
“Income from wages, for example, is often only a proportion of total household income. However, the figures do provide a picture of how consumers are faring. It is very clear that those South Africans who were in already poorly paid jobs, particularly those working in the informal sector, have been hardest hit,” said Lappeman.
South Africa’s lockdown came into effect on 27 March 2020, and passed the 500-day mark on 9 August 2021. The national state of disaster has been in effect for 17 months.
Data published by debt counsellor DebtBusters this week also shows that middle-class South Africans are increasingly taking on debt. For those taking home more than R20,000 per month, the total debt to annual net income ratio is 152%.
Looking at the monthly data, those taking home over R20,000 per month need to spend 60% of their monthly net income on repaying debt, the group’s Q2 2021 Debt Index shows.
While debt exposure worsened for all income groups, the worst increases are those taking home R10,000 or more. Their debt to income ratio is 127% or more, the highest DebstBusters has ever recorded.