Answer to Question #207056 in Microeconomics for Bee

Question

Provide a brief explanation of the public wage bill in South Africa

Answer 1

The public sector wage refers to salaries and wages paid to public servants. In South Africa, there are 5.60 million employees in the public sector for December 2020. The public sector wage bill has been increasing rapidly in various countries and South Africa is not an exemption. It's said to spend nearly a third of its budget to pay salaries to employees in the public sector which is relatively high. The government of South Africa is determined to reduce it by 311 billion by 2023/2024. This is to be actualized by two strategies namely: wage freeze for the next three years from the year 2020 and by not implementing a pay increase that was agreed on in 2018. However, it's projected that even if the wage cuts would be successful, the budget deficits will still be an issue.