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South Africa Economic Outlook 2022

Until recently, South African salaries and wages were expected to increase only moderately during 2022. However, producer price inflation has accelerated over the past six months — and in March and April in particular — due to higher international commodity prices. Local businesses have had to pass on these cost increases to consumers, and in March, consumer price inflation accelerated to 5.9% y-o-y. 

Alongside a recent deterioration in South Africa’s overall inflation environment, survey data shows that trade unions’ expectations have grown for more substantial upward adjustments in remuneration as workers' cost of living increases. This will have a varying impact on different industries and sectors depending on their overall exposure to labour as an input cost.

Exploring PwC's South Africa Economic Outlook

In this edition

The next inflation challenge: salary and wage increases

PwC’s South Africa Economic Outlook (April 2022) report updates our different forward-looking scenarios for the South African economy. At the core of this is the prospect of elevated inflation and the impact that this will have on adjustments to salaries and wages. 

Key content in this edition includes:

  • Floods in KwaZulu-Natal
    • The rand weakened by 8% as load-shedding, the COVID-19 positivity rate, and flooding in KwaZulu-Natal weigh on the economic outlook.
    • Manufacturing and transport are the hardest hit by flooding while costs are still being counted.
  • Rising labour costs
    • The private sector is being hit by escalating supply-side inflation pressure.
    • Trade unions expect a more than 6% increase in salaries and wages this year. 
    • Understanding exposure by industry to increasing staff costs.
  • Employment data trends
    • 262,000 jobs were added in 2021Q4 as the economy recovered from the July unrest.
    • Updates to our long-term jobs and unemployment rate forecasts.



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Lullu Krugel

Lullu Krugel

Partner and Chief Economist, PwC South Africa

Tel: +27 (0) 11 797 4929