SA one of most skewed income countries in the world – Research

The Bureau of Market Research has found that personal income distribution in South Africa largely remains skewed, and continues to exacerbate inequality.

The market research shows that 75% of the adult population in the country earns below R5 800 per month, while only 3.8% of the adult population earns more than R48 000 per month.

It further shows that 13% of the adult population relies mainly on grants as a cash flow income source.

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Analysis of the insights on the four subindices of the CFVI revealed the main reason for the deterioration in consumers’ financial vulnerability between Q1 2022 and Q2 2022 is attributed it to a decrease in the resources or assistance consumers could access to cope with rising prices and interest rates.

Speaking to the SABC, Head of Household Wealth Research at the Bureau of Market Research, Jacolize Meiring said South Africa is unfortunately are one of the most skewed income countries in the world

“So, for 2021, cash flow income recorded a total income of R4,4 trillion. Some of the very disheartening income statistics are that 75% of our adult population, so those are once again 15 years old and above, earned below approximately R5800 per month. It is estimated that only 3.8% of our adult population earned more than R48 000 per month.”

The Bureau sayid the outlook for Q3 2022 seems to be bleak.

“The overwhelming majority expect consumer price inflation to increase rapidly. Unemployment is expected to increase. The South African and global economies are expected to perform worse by close to two-thirds of the key informants.”

“Some 69.1% anticipate the state of consumer finances to deteriorate, while 45.7% expect consumers to feel even less in control of their finances,” it said.

The Bureau of Market Research also said some 96.8% of key informants are of the opinion it will take more than another year for consumer finances to recover from the impact of Covid-19 and the lockdown.

“High levels of consumer financial vulnerability in the short- to medium-term will in all likelihood persist, given an increasing number of structural imbalances, downside risks, political and social instabilities, increasing poverty and inequality, as well as governance and government administration deficiencies.”

“This will negatively impact the economy, employment and household incomes, which will filter through to adversely affect all aspects of consumer finances,” the Bureau of Market Research said.

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