The nominal average take-home pay reached R17 144 in July 2025, 1.1% lower than the R17 339 reflected in June 2025.
Image: Karen Sandison/Independent Newspapers
South Africans will feel the financial squeeze as the average nominal take-home pay marginally declined in July, according to the latest BankservAfrica Take-home Pay Index (BTPI).
The nominal average take-home pay reached R17 144 in July 2025, 1.1% lower than the R17 339 reflected in June 2025 and a significant 6.9% lower than in February 2025.
The index, which tracks the monthly salary movements of approximately 3.8 million South African salary earners. However, the latest salary payments data reveal the pressure on workers, caught between a weak job market and rising municipal rates.
Although the slowdown in 2025 is concerning, the data also points to the current employment trends.
“Given that the BTPI is based on the total value of salaries paid into employees’ bank accounts - excluding those above R100 000 – divided by the number of salary payments, it not only tracks pay levels but also reflects the underlying movements in the labour market,” said Elize Kruger, an independent economist.
A trend in the first seven months of 2025 partly explains the moderation. Salary payment data - excluding weekly and bi-monthly wages - shows fewer salaries in the R40 000–R100 000 range, pointing to job losses in higher income brackets. At the same time, most new salary payments were concentrated in lower categories, particularly up to R10 000 per month and between R20 000–R30 000.
“Thus, additional salaries at lower levels and losses at the higher income side, could partly explain the depressed trend in the average,” said Kruger.
Still, the average nominal take-home pay for 2025 is expected to end notably higher than in 2024, making this, on balance, a positive salary year despite the risks in the broader economic outlook.
In real terms, take-home pay also moderated further by 0.9% month on month to R14 660 in July 2025, compared to R14 798 in June. These were still above year-ago levels. With inflation forecast to average 3.5% in 2025 – compared to 4.4% in 2024 - and industry information suggesting an average salary increase above 5%, 2025 will be the second consecutive year of a real increase in earnings.
“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,” said Kruger.
However, a comparison between average headline inflation and the nominal average increase in the BTPI since 2017 suggests that salaries have recovered, but not fully after the weak years between 2021 to 2023.
“Salary earners continue to grapple with the higher cost of living. This impact is felt more sharply in July – the month notorious for annual municipal tariff increases, and serves as a stark reminder that some costs continue to rise well above the country’s inflation rate,” said Kruger.
Municipal tariffs are typically not reflective of a competitive environment, but instead mirror the realities within local authorities, which in many cases include inefficiencies, lack of maintenance, cross-subsidisation and corruption activities, all eroding available capital for service delivery. Municipal services in Johannesburg, effective July 1, 2025, as an example, are notably up on 2024 levels and far above the current inflation rate. A similar scenario plays out in other metros.
“This trend, evident in administered prices, will remain a key obstacle to bringing inflation expectations closer to the 3% target,” said Kruger.