With domestic worker wage inflation below headline or even core inflation, this could point to household employees struggling to keep up with the rising cost of living in the country.
Headline CPI for December 2022 tracked at 7.2%, down marginally from 7.4% in November. Core inflation – excluding food and fuels – was lower at 4.9% for the month.
The basket of goods and services tracked by Stats SA to measure inflation changes from time to time included domestic worker wages in December’s basket. Domestic worker wages are also tracked in March, June, and September.
Domestic worker wage inflation was only 4.2% year-on-year. This rate is far below headline CPI and core CPI and shows that wages paid to domestic workers in the country are not keeping up with both headline and core inflation.
Wage inflation was tracked at 3.5% in June (versus headline CPI at 7.4%, core inflation at 4.4%), 2.9% in March (vs headline CPI at 5.9%, core inflation at 3.8%), and 3.8% in September (vs headline CPI at 7.5% and core inflation at 4.7%).
Domestic worker wages have consistently fallen short of core inflation by 0.9 percentage points in 2022. This expanded to 1.2 percentage points in November but dropped to 0.7 percentage points in the final month of the year – a positive turn.
|Month||Headline inflation||Core inflation||Domestic worker wages||Headline difference||Core difference|
|December 2022||7.2%||4.9%||4.2%||-3.0 pp||-0.7 pp|
|November 2022||7.4%||5.0%||3.8%||-3.6 pp||-1.2 pp|
|September 2022||7.5%||4.7%||3.8%||-3.7 pp||-0.9 pp|
|June 2022||7.4%||4.4%||3.5%||-3.9 pp||-0.9 pp|
|March 2022||5.9%||3.8%||2.9%||-3.0 pp||-0.9 pp|
Domestic workers are already low-earners in South Africa, with salary data from SweepSouth in August 2022 showing that the average worker takes home just R2,997 per month.
Wages for the sector were only brought in line with the national minimum wage in 2022.
From 1 March 2022, the National Minimum Wage for each ordinary hour worked increased from R21.69 to R23.19. For domestic workers, the increase in minimum wage was much larger, from a rate of R19.09 per hour – 88% of the national minimum wage in 2021.
Assuming a domestic worker works 160 hours a month (eight hours a day, 20 days a month), the monthly wage comes to R3,710 for the month.
Households should expect to pay more for domestic help in 2023, with the National Minimum Wage commission recommending an 8% increase to the NMW for 2023.
The commission announced in December 2022 that it is conducting an investigation into the NMW for 2023 and is eyeing an increase in the CPI+0.5% and CPI+1% range.
With CPI averaging around 7% for 2022, this would put the hike around 8%.
The current national minimum announced by Employment and Labour Minister Thulas Nxesi in February 2022 was adjusted from R21.69 in 2021 to R23.19 in 2022 for each ordinary hour worked. The increase came into effect on 1 March 2022.
A hike to R25.05 would push the monthly rate to over R4,000 for a worker who works 8 hours a day, 20 days a month. This is approximately R300 more than in 2022.