South Africans “fully employed but falling behind” as living costs surge

South Africans are working more but falling further behind financially as the cost of living continues to outpace income, according to new insights released ahead of Workers’ Day.

The warning comes as household debt reached 61.6% of disposable income by the third quarter of 2025, meaning that for every R100 earned, nearly R62 is already committed to repayments, according to the South African Reserve Bank.

This leaves many workers with little left to cover daily expenses such as food, fuel and basic services. The situation is being felt across the country, including in the Eastern Cape, where high unemployment and rising prices are already straining households.

Sebastien Alexanderson, head of National Debt Advisors, says the financial pressure is no longer just about income levels.

“For many South Africans, the real strain is that money is losing effectiveness,” he said. “You can be fully employed and still feel financially constrained because your income isn’t keeping pace with the cost of living.”

He adds that the traditional idea that working harder leads to better financial outcomes is no longer holding in the current economy. Workers are taking on more responsibilities but not seeing meaningful financial progress.

What is not confirmed is whether wages will adjust in the near future to match rising living costs. There has also been no official government announcement addressing this specific gap between income growth and inflation.

The growing pressure is pushing more people to take on side hustles. However, Alexanderson warns that not all extra work improves financial stability. Many side jobs simply extend working hours without increasing long-term income.

“If the income disappears when you stop working, it’s not building leverage,” he said.

Instead, he encourages workers to focus on income streams that can grow over time, such as investments or scalable businesses, although access to these opportunities remains limited for many South Africans.

For readers in Pondoland and across the Eastern Cape, the impact is immediate. Rising transport costs, food prices and debt repayments are tightening already stretched household budgets. Many families are relying on a single income while supporting extended households, making financial pressure even more severe.

The situation highlights a growing gap between employment and financial security — a reality that affects both urban and rural communities.

Workers are being urged to rethink how they manage money, prioritise savings where possible, and avoid burnout from excessive workloads that do not improve financial outcomes.

Local impact is clear: even those with jobs are struggling to keep up, and financial stress is becoming part of daily life.

We will update this story if government or financial regulators respond with new measures or relief options.