According to the government proposal, minimum wages can be increased by more than 8%

Union members gathered outside the Civic Center in Cape Town.

  • The National Minimum Wage Commission is considering a wage adjustment in the range of CPI plus 0.5% and CPI plus 1% for 2023.
  • Tits adjustment would increase wages up to R25.13 per hour at current inflation rates.
  • As of this year, domestic workers receive the same minimum wage as other workers.
  • For more financial news go to News24 Business front page.

The minimum wage could rise by more than 8% next year, according to a new proposal from the Labor Department’s National Minimum Wage Commission (NMW).

The Commission has proposed an increase in the consumer price index (CPI) by 0.5% to 1%.

In November, the CPI reached 7.4%. Assuming an increase in the CPI plus 1%, at the current rate of inflation this would raise the minimum wage to around R25.13 per hour. For those working nine hours a day, this equates to around R4,750 a month.

The minimum wage was raised by nearly 7% in March 2023, from R21.69 to R23.19 per hour. For the first time, domestic workers were paid the full minimum wage. In the past, their wages were set below the minimum wage.

READ | New minimum wage a boost for millions of workers – Cosatu

Stakeholders have until Jan. 13 to respond to the new proposal, the department said.

NMW Chair Professor Adriaan van der Walt said the commission aims to ensure the value of the national minimum wage does not fall relative to the median wage.

“All workers must earn enough to maintain a decent standard of living, defined as sufficient to support themselves and their families at a level that is both socially acceptable and economically viable,” Van Der Walt said.

Food and fuel prices rose in 2022 following the invasion of Ukraine, which sparked an oil price rally and led to short-term grain and cooking oil shortages. As a result, millions of households are struggling to afford transportation and food

Bread and grain prices in November were almost 20% higher than a year ago, Statistics SA reported. The prices of detergents (38%), sunflower oil (+32%) and coffee (+25%) have also skyrocketed.

READ | Chicken off the table for poor South Africans after prices go up

But companies hit by skyrocketing interest rates and record strains may balk at the proposed steep increase in the minimum wage.

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