Ailing economy douses hopes of any bonus, pay increases
JOHANNESBURG – South African senior professionals, especially in the retail, manufacturing and finance sectors, are neither optimistic about a bonus this year nor a salary increase in the new year.
The belt-tightening as a result of the sluggish economy has doused expectations of a bonus and salary raises, according to the Jack Hammer Bonus and Salary Survey for 2019.
These expectations are the lowest they have been in the past four years, the annual survey shows.
About 56 percent of respondents indicated that they expected little in the way of bonuses this year, and 33 percent were anticipating no salary increase.
Jack Hammer said the trend had been on the wane since 2016, when those banking on a bonus in line with or above the previous year stood at 77 percent, which declined to 66 percent in 2017 and slipped further to 62 percent last year.
This year, expectations of a bonus equal to or exceeding last year's have plunged to 44 percent.
“It is clear that reality is hitting home now, with professionals accepting that if the company and the economy is under stress and profitability is lower, everyone is going to feel the pain,” said Jack Hammer chief operations officer Advaita Naidoo.
In retail and financial services, where many businesses were not meeting their targets, bonuses and increases were not expected.
A main cause of despondency among South Africa's professionals arose from concerns around political factors and poor management of state-owned enterprises, high unemployment levels and retrenchment, as well as a perceived lack of capacity-building in emerging skills disciplines.
On emigration, the survey found that while the vast majority of respondents from all demographics again indicated that they would consider moving abroad, the trend could be reaching a plateau.
This year, 79 percent said they would move, compared with 82 percent last year and 76 percent in 2017, which saw a massive jump from 29 percent in 2016.
“Although the numbers still show a steady increase in those willing to consider a move abroad, the biggest jumps were in 2017 and 2018…
"This year, although overall the brain drain remained a real thing, the tide now seems to be calming,” Naidoo said.