Basic food basket costs minimum-wage earners over a third of net income, study says

The minimum wage increase kept up with the prices of basic products in the past year, but South Africans in this bracket need to spend 35% of their income on a “survival basket”.

This is according to the Minimum Wage report collated by Picodi.com on how the minimum wage for full-time work changed in 67 countries in January 2024, and what part of the income has to be spent on a basic basket of food necessary to live.

SA employees on a minimum wage earn R4,353 net monthly, compared to R3,979 in January 2023.

This ranks SA in 44th place of the ranking (9.4% increase).

A basket of basic food products necessary to live cost R1,503 as at the beginning of 2024 (6.07% more than 2023).

The report found: “This amount represents 34.5% of the net minimum wage, while at the beginning of 2023 it was 35.6% of the minimum wage. This means the increase in the SA minimum wage kept up with the rising cost of food prices.”

For the study, the team created a basic grocery basket consisting of eight groups of products: bread, milk, eggs, rice, cheese, meat, fruit and vegetables.

It said: “This list of products is more than modest, nevertheless these products in the given quantities can meet the minimum nutrient requirements of an average adult for a month.”

The cost breakdown is:

• Milk (10l) — R187
• Bread (10 loaves, 500g each) — R168
• Rice (1.5kg) — R39
• Eggs (20) — R61
• Cheese (1kg) — R127
• Poultry and beef (6kg) — R595
• Fruits (6kg) — R147
• Vegetables (8kg) — R179.

Citizens of the UK enjoy the best minimum wage to food price ratio (7.2%), whereas the Nigerian minimum wage does not cover even the most basic food basket cost (116.5%).

Other countries which have the most comfortable ratio of the grocery basket to the minimum wage include the Netherlands, Luxembourg and New Zealand. In these countries, workers spend less than one-tenth of the minimum wage on basic groceries. 

SA is far behind these countries, ranking higher than places such as Mexico (35%), Brazil (37.1%), Ukraine (49.3%) and India (58.5%).

Countries where the basic food basket consumes more than half the minimum wage include Kazakhstan (54%), India (58.5%), Vietnam (65.6%) and Armenia (74.6%).

TimesLIVE