South Africa raises minimum wage above market expectations

wagmi_eventually · 2026-02-14T12:15:57+00:00

The South African government has implemented a significant 5% increase in the minimum hourly wage, surpassing predictions and reaching 30.23 rand (approximately $1.89) as of January 2026. This move aims to support workers' incomes amidst current economic conditions and is expected to boost business activity and employment in the country.

wagmi_eventually

2026-02-14 12:15:57

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The government of the Republic of South Africa has implemented a significant increase that surpassed economists’ and business circles’ forecasts. Starting from January 2026, the minimum hourly wage has increased by 5%, reaching 30.23 rand, which is equivalent to $1.89 USD. This increase exceeds the expected annual growth rate of 4.7%, which was forecasted by analysts, unions, and business representatives in a survey conducted by the Bureau of Economic Research in December 2025.

How much has the salary in South Africa increased

The revised minimum wage set by the government demonstrates a decisive approach to supporting the income of the working population. The announced 5% increase significantly exceeds market participants’ consensus forecasts. According to Jin10, this decision was made considering the current macroeconomic situation and the needs of workers.

Inflation and salary review: economic context

The key factor in the wage review was the price situation. According to data from South Africa’s Statistical Agency, the consumer price index showed a 3.6% year-on-year increase in December 2025. At the same time, the average projected inflation for the entire 2025 year decreased to 3.2%, allowing the government to balance protecting workers’ purchasing power and supporting entrepreneurship.

Economic prospects and impact on employment

Matthew Parks, parliamentary coordinator, emphasized that the increased wage “brings the necessary momentum to the economy, stimulates business activity, and promotes job creation.” The rise in the minimum wage, exceeding market forecasts, is seen as a tool to maintain demand amid moderating inflation, which should positively influence the country’s socio-economic development prospects.

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