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BusinessTech reports that the United Nation’s International Labour Organisation (ILO) has named SA as one of the few emerging markets to experience a fall in real wages in 2020.
SA’s economy registered one of the largest falls in nominal and real wage growth in 2020 compared to most of its comparable emerging market peers – Brazil, Russia, Mexico and parts of the Middle East. The ILO data showed that SA saw a 4.8% fall in real wages (-2.6% nominal) in 2020. In an analysis of the data, BNP Paribas senior economist Jeff Shultz said that the relief measures provided through the Covid-19 Temporary Employer/Employee Relief Scheme (Ters) and the social relief of distress (SRD) grant have also shrouded the true effect of the pandemic on SA businesses and households. “When Ters and SRD measures come to an end in April, true household and corporate scarring will show its face,” he said. “With these measures coming to an end in April – and with the usual lags with this kind of data – we are still likely yet to see the true impact of Covid-19 and the lockdown on businesses and households. Stats South Africa’s monthly liquidation stats demonstrate some of what is to come, and they don’t make for pretty reading, as they remain on a sharply climbing trajectory,” Shultz added. The 2021 Budget Review forecasts growth in personal income tax (PIT) averaging 6.8% nominal (2.7% real) over the medium term. “We do still worry that the National Treasury’s tax buoyancy assumptions still look too bullish – for both PIT but also Corporate Income Tax (CIT),” said Schultz.
- Read the full original of the report in the above regard at BusinessTech
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