The Department of Employment and Labour says that increases in the national minimum wage have not impacted employment numbers in South Africa.

The Department said that research had been conducted annually for the past three years, assessing the impact of the national minimum wage on employment, hours of work and wages.  They observed no significant shifts in aggregate employment following the national minimum Wage increases over the past few years.

This sentiment goes against many expert opinions- that said the increases in the national minimum Wage amid the current economic climate would cripple businesses and led to job losses across the country.

Private households (domestic workers and gardeners) were also among the sectors noted by the Department of Employment and Labour. The research showed that it also experienced no significant changes in employment due to increased national minimum wage.

Latest South Africans currently employ around 863 000 domestic workers. South Africa has historically had around 1 million domestic workers employed in the country, but this took a massive knock in 2020 following the Covid-19 pandemic and subsequent lockdowns.

 

Other factors pressuring the affordability of the National Minimum Wage.

 

“While there are legitimate concerns about the impact of the annual national minimum wage adjustments on employment in the country, it is worth noting that the Covid-19 pandemic negatively affected employment as many business establishments closed down and many people left unemployed”.

Over 2021 and 2022, the Covid-19 pandemic coincided with the period of the national minimum wage adjustments, making it difficult to evaluate and isolate the impact of an increase in the national minimum wage from the effects of the pandemic.

Job losses were dominated by two causes: employers no longer being able to afford the services of their domestic worker and their employer moving homes. Domestic workers said they lost their job because their employer had move or the employers moved to a different town or city in South Africa or moved to another country.

The purpose of the national minimum wage is to ensure a living wage.

As of March 2023, the national minimum wage increased from R23.19 per hour to R25.42 per hour – equating to roughly R4 270.00 per month.

 

W.Tel no.: 021 423 3959
Cell: 082 433 8714
Fax: 021 4232 105
E-mail: bernard@capelabour.co.za
Website: www.capelabour.co.za