BankservAfrica’s Take-home Pay Index (BTPI) has revealed that the take-home pay for approximately 4 million salary earners has gained momentum at the start of 2025.
With an average monthly take-home pay soaring to R18 098 in January, up from R17 246 in December 2024 and R15 564 just a year prior, these statistics have been met with optimism by economists who view this as a significant sign of economic improvement.
Shergeran Naidoo, BankservAfrica’s Head of Stakeholder Engagements, noted the steady upward trend in average salaries since early 2024. “Despite some monthly volatility, nominal take-home pay continues to tick higher,” he said, illustrating the resilience of South African salary earners amidst lingering economic challenges.
Independent economist Elize Kruger echoed this sentiment, attributing the positive developments in take-home pay to a combination of factors including a generally improved business environment, a noticeable moderation in inflation, and a boost in consumer confidence, bolstered further by three interest rate cuts throughout 2024.
“The significant increase in the gross operating surplus of companies demonstrates an improvement in company profitability, contributing to this positive trend,” Kruger said.
In real terms, the take-home pay has seen a remarkable increase, reaching R15 659 in January 2025— a substantial 12.8% rise compared to the previous year.
This advancement is attributed largely to a significant drop in consumer inflation, which fell from 5.3% in January to 3.0% by December 2025. Furthermore, the overall Consumer Price Index (CPI) averaged just 4.4% in 2024, marking the lowest annual rate since 2020.
Kruger highlighted that the real take-home pay figures, averaging R14 292, represent the first significant real increase since 2020. If inflation remains in check throughout 2025, with an estimated average CPI of 4.2%, this could herald a second consecutive year of real take-home pay growth.
The recovery in disposable income is already translating into tangible benefits for the retail sector, as evidenced by a 2.5% rise in real retail sales growth for 2024, a stark contrast to the -1.2% downturn recorded in 2023.
There is also encouraging news in the automotive market, where passenger car sales started to recover, registering a growth of 1.1% for the full year, compared to a contraction of 4.3% the previous year.
Looking to the future, experts are optimistic that the current economic trajectory will allow for continued growth in real wages.
“We expect GDP growth to be around 1.7% for 2025, boosted by increased household consumption, investments, and ongoing structural reforms,” Kruger said.
Addressing long-standing infrastructural challenges, particularly within power generation and transportation, remains critical to unlocking the country’s full potential.
Professor Waldo Krugell from North-West University reinforced this perspective, asserting that these developments are undeniably positive not just for households but for the wider economy as well.
“It highlights the importance of maintaining low and stable inflation, and I hope these improvements lead to enhanced job creation and economic growth,” he emphasised.
Similarly, Professor Raymond Parsons from North-West University characterised the rising take-home pay statistics as beneficial for both workers and the overall economy, suggesting that growing consumer spending could provide much-needed momentum for sustained economic growth in 2025.
BUSINESS REPORT