Just 1% real increase
Inflation set to erode workers’ salary rise this year
SOUTH African salaried workers are expected to have only a 1 percent real increase in salary in the current year, among the lowest gauged in the Korn Ferry 2019 Global Salary Forecast.
The workforce would expect to have a
6.5 percent nominal salary increase, which would be whittled down by inflation considerations to the 1 percent real gain.
According to the forecast, the country’s workers trail their counterparts in Egypt, Ghana and Nigeria who have the highest nominal increases, all more than 10 percent, while real salary growth is predicted in Ghana, Morocco, Mozambique and Tunisia.
“With inflation rising in most parts of the world, we’re seeing a cut in real-wage increases across the globe. The percentage of salary increase or decrease will vary by role, industry, country and region, but on average employees are not seeing the same real pay growth they did even one year ago,” said
Bob Wesselkamper, Korn Ferry global head of rewards and benefits solutions.
The report notes that although topline salaries will increase by 7.7 percent in Africa, high inflation means the real increase is predicted to be only 0.9 percent. For example, in Egypt, salaries are expected to increase on average by 15 percent, but a 14.4 percent inflation rate means employees will only see a 0.6 percent real-wage increase.
The Korn Ferry forecast reveals that, adjusted for inflation, real-wage salaries globally are expected to grow an average of 1.0 percent in 2019, down from a 1.5 percent prediction for last year.
Malcolm Pannell, managing director for Korn Ferry, Sub-saharan Africa, said: “Reward in Africa presents many unique challenges for companies.
Models often differ from more traditional/global models in that the pay mix can be very different. Benefits and allowances can be vastly higher than those in more mature markets due to a wide array of subsidies, including housing, generators, fuel, transport and even food, because of infrastructure difficulties.
In turn, variable bonus pay can be much lower due to a lesser focus on individual performance.”
The survey was drawn from Korn
Ferry’s pay database, which contains data for more than 20 million job-holders in 25000 organisations across more than 110 countries.