01.03.04. Poverty and inequality | South Africa
01.03.04. Poverty and inequality | South Africa
12 Aug 2022
South Africa faces a ‘triple challenge’ of high poverty, inequality, and unemployment and it has been identified as one of the world’s most unequal countries in the world (The World Bank, 2018a). The Living Conditions Survey (2014/15) found that the country’s Gini coefficient increased at the end of Apartheid (i.e., 0.61 in 1996) to 0.63 in 2015 as one of the highest in the world (The World Bank, 2018a).
South Africa sees a polarisation of its employment market and is divided into two extreme job types: on the one end of the spectrum there is a small number of people with high earning jobs which once obtained, they are unlikely to give up and the other extreme where the majority of the population work at low earning jobs – the latter being more fluid and witnessing exits from employment (The World Bank, 2018a). The National Minimum Wage (NMW) was set at ZAR3500 per month across all sectors from May 2018 (with domestic and agriculture minimums set at 75 and 90% respectively (The World Bank, 2018a). Race and gender statistical trends remain biased where African and female workers on average earn significantly less than male and white workers (The World Bank, 2018a). Despite a notable decline in the observed gender inequality after 2011 (The World Bank, 2018a), the average gender pay gap in South Africa is reported at 28.6% in the Global Wage Report for the year 2018/19 (i.e., where women earn an average of 28.6% less than men for the same job). Women are generally earning less in South Africa leading to female-headed households being 10% more likely to become impoverished (and 2% less likely to escape it) than households headed by their male-counterparts (The World Bank, 2018a). Women still comprise less than 50% of positions of influence, for example 32% of Supreme Court of Appeal judges, 31% of advocates, 30% of ambassadors and 24% of Heads of State-owned enterprises (StatsSA, 2018c). Less than a third (32%) of managers in South Africa are women, and tend to dominate the domestic worker, clerical and technician occupations (men dominating the rest) (StatsSA, 2018c). By 2017, senior level management (decision-making level) are over-represented by men who dominate in both the public (60.7%) and private (68.5%) sectors (SAHRC, 2017a). Top level management in both public and private sectors also continue to be overrepresented by men, where women comprise 32.6% of top positions in government and 21.6% in the private sector (Department of Labour, 2017).
The majority of South Africans live in poverty (76%), of which nearly half are considered chronically poor and living at the upper-bound national poverty line of ZAR 992 per person per month (The World Bank, 2018a). Middle class earners constitute 20% of the working population between 2008 and 2015 and are a comparably smaller proportion than in other countries (The World Bank, 2018a). South Africa has also seen an increase in its poverty rate from 36 to 40% between 2011 and 2015 (The World Bank, 2018a). Poverty has also ‘deepened’ during this period as well and shows a 2.4 point increase (i.e., 16.4 to 18.8%) when calculated at the US$1.9 a day poverty line. Female-headed households, black South Africans, the less educated, the unemployed and bigger families experience higher levels of poverty (The World Bank, 2018a).
Rural areas in South Africa have the highest concentration of poverty (60.3% in 2006 and 59.7% in 2015), for which the Eastern Cape, KwaZulu-Natal, and Limpopo are the three poorest provinces in the country (2006-2015) (The World Bank, 2018a).
 Gini coefficient: Numbers range from 0 to 1; the higher the number/closer to 1, the greater the degree of income inequality
Department of Labour. (2017). Commission for Employment Equity Annual Report 2017-2018. Availabe from: https://www.abp.org.za/wp-content/uploads/2018/07/Commission-for-Employment-Equity-18th-Annual-Report.pdf
SAHRC. (2017a). RESEARCH BRIEF ON GENDER AND EQUALITY IN SOUTH AFRICA 2013 to 2017. Available from: https://www.sahrc.org.za/home/21/files/RESEARCH%20BRIEF%20ON%20GENDER%20AND%20EQUALITY%20IN%20SOUTH%20AFRICA%202013%20to%202017.pdf
StatsSA. (2018c). How do women fare in the South African labour market? Statistics South Africa. http://www.statssa.gov.za/?p=11375
The World Bank. (2018a). Overcoming Poverty and Inequality in South Africa:An Assessment of Drivers, Constraints and Opportunities. Available from: https://documents.worldbank.org/en/publication/documents-reports/documentdetail/530481521735906534/overcoming-poverty-and-inequality-in-south-africa-an-assessment-of-drivers-constraints-and-opportunities