Salaries hold steady in SA, but consumers may feel poorer as fallout from Middle East war mounts

Fresh data points to a stabilisation in net salaries in South Africa over the first quarter of 2026, however the outlook for the remainder of the year is expected to be impacted by economic uncertainty linked to the war in the Middle East.

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Salaries edged higher in March 2026, remaining above the levels of a year ago, according to the latest PayInc Net Salary Index report.

(Click here for a summary of the findings)

The payments provider (formerly known as BankservAfrica) says net salaries increased by a marginal 0.1% month-on-month to reach just over R21 500 in March. This remains 2.3% higher than 12 months ago.

However, the nominal growth in net salaries continues to tread water, with the Index declining in real terms by 1% year-on-year in the first quarter of 2026.

The stats come from tracking the average nominal net salaries of approximately 2.1 million employed people in South Africa.

“While both headline and core inflation remained well under-control and aligned with the South African Reserve Bank’s newly adopted inflation target up to March, the significant fuel price spikes in April have derailed the favourable outlook for inflation envisaged at the start of the year,” says independent economist Elize Kruger.

In conversation with Stephen Grootes, Kruger says that 2.3% year-on-year hike remains quite moderate.

"This increase is nominal if you think about inflation a bit above 3% in Q1... and compared to the brisk economic activity we saw in that quarter."

What is concerning, she says, is that we're seeing now the economic outlook changing to the down side, with the detrimental impact of the Iran war that will be placing more pressure on companies' profitability and will filter through to the workforce.

From that point of view the fact that things are just levelling off in Q1 is not great news, she reiterates.

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"The extent of the hikes we're seeing is severe - especially if you look at it cumulatively... If you think April, May, June, and add the increases we're going to see by the end of the third month with that fuel levy being added back... you're looking at significantly higher fuel prices that will filter through the whole supply chain."

"So it's not only the direct impact on inflation but also a broader round of price increases on the back of that... which will really damage our economic prospects, and the purchasing power of salary earners."

Scroll up to he audio player to listen to Kruger's analysis