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South African businesses plan 5.5% pay rises for 2022 as pay freezes fall

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October 27, 2021

JOHANNESBURG, October 27, 2021 — Employers in South Africa plan to give their staff an average annual pay rise of 5.5% in 2022, research by Willis Towers Watson revealed today.

The rise is an improvement on the 4.7% average increase paid this year and, with inflation forecast at 4.2% to 4.5% in 2022, gives a real terms rise of up to 1%. It comes as the proportion of businesses expecting to freeze pay altogether is set to fall from 12% this year to 5% in 2022.

Melanie Trollip, Director of Talent and Reward at Willis Towers Watson South Africa, said: “Businesses are navigating a tentative recovery from the pandemic, and it is encouraging that many are planning to offer more generous pay rises. The thaw in pay freezes will be welcome and many people can expect next year’s pay rise to be an improvement on this year.”

Some industries plan to be more generous than others. Average pay rises in 2022 are set to be higher in the medical technology (7.1% rise), pharmaceutical (6.1%), and consumer product (6%) sectors. Workers in business consulting (3.7%), energy and natural resources (4.1%), and construction (4.2%) are due to fare less well.

The war for talent has continued despite the pandemic. In 2021, South African businesses tried to motivate and retain the top performers by giving them a pay rise that was 2.5 times greater than for staff on average performance ratings.

Melanie Trollip added: “The pandemic’s economic onslaught has hit some business sectors harder than others, so some are better placed to offer more. The pharma sector stands out as one of the most generous, while rises in the energy and construction sectors may not even match inflation.

Even though Covid wreaked havoc on our economy, firms still had to compete to attract and retain the top performers”

Melanie Trollip,
Director of Talent and Reward,
Willis Towers Watson South Africa

“Even though Covid wreaked havoc on our economy, firms still had to compete to attract and retain the top performers, and higher pay rises were part of that strategy. Now that we may be entering a recovery phase, these high performers are especially important for driving business growth.”

320 South African firms took part in the authoritative global Salary Budget Planning Report by Willis Towers Watson (NASDAQ:WLTW), a leading global advisory, broking, and solutions company.

Notes to editors

  1. The Salary Budget Planning Report is compiled by Willis Towers Watson’s Data Services Practice. Approximately 23,000 sets of responses were received from companies across 130 countries worldwide. 320 organizations in South Africa responded.
  2. The report summarises the findings of Willis Towers Watson’s annual survey on salary movement and reviews practices as a means of helping companies with their compensation planning for 2021 and beyond.

About Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 45,000 employees serving more than 140 countries and markets.

We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals.

Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance.

Together, we unlock potential.

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