Household spending reached R3-trillion in 2022/23: Stats SA survey

The Income & Expenditure Survey (IES) 2022/2023 published by Statistics SA (Stats SA) reveals households collectively spent about R3-trillion.

The average household expenditure reached about R143,691 for the year.

The survey indicated the top four spending categories were housing, food, transport and insurance, which accounted for nearly 76% of all household expenditure.

“Households allocated most of their consumption expenditure to the four main areas, meaning three out of every four rand were directed towards the essentials,” Stats SA said.

The median household consumption expenditure stood at R82 861, indicating stark income inequality within the country.

“The gap between the average and median expenditure reflects significant income inequality. A large portion of the population spends well below the national average, pulling down the median expenditure. The spending habits of wealthier households skew the average, while most households operate with much lower expenditure levels.”

The survey also revealed a gender divide in household spending patterns. Male-headed households contributed just more than 60% of total household consumption expenditure and spent an average of R159,315.

Female-headed households, accounting for just under 40% of total spending, spent an average of R123,346.

The average household income in 2023 was reported at R204,359.

Male-headed households earned more, with an average annual income of R239,590, compared to R158,481 earned by female-headed households.

Gauteng, with its large population, dominated consumption expenditure, contributing 36% of total household spending. The Western Cape followed at 18.4%, with the two provinces collectively accounting for more than half of all household spending nationwide. Households in the Western Cape had the highest average annual expenditure at R229,636, while Gauteng households spent an average of R170,628.

The Northern Cape had the smallest share of total household consumption expenditure at 1.7%. North West recorded the lowest average household expenditure, at R98,147, with a median consumption expenditure of R61,495.

The survey also highlighted differences between urban and rural households. Urban households were responsible for 81.5% of total household consumption expenditure, far outstripping the contributions from traditional areas (15.3%) and farm settlements (3.2%).

Households in traditional areas reported the lowest average expenditure at R84,502, while those in farm settlements had the lowest median expenditure at R59,503.

Black African-headed households, which faced the most financial challenges, had 45.3% of households in the lowest two expenditure quintiles, spending less than R25,063 annually. Only 13% of black African-headed households were in the highest expenditure quintile.

Coloured-headed households exhibited a mixed spending pattern, with 21% in the upper expenditure quintile while 34.4% remained below the third expenditure quintile.

Indian/Asian-headed households saw a stronger presence in higher spending brackets, with 77% falling into the upper two quintiles. White-headed households fared the best, with 78.1% in the top expenditure quintile.

Stats SA observed a 7.2% decrease in average household consumption expenditure in the past eight years. However, black African-headed households bucked this trend, experiencing an 8.8% increase in real household spending.

Other population groups, including coloured, Indian/Asian and white-headed households, saw declines.

The report noted the decline in spending among white-headed households may be linked to under-reporting by sampled households rather than changes in household spending patterns.

The IES 2022/2023 provides an invaluable snapshot of South Africa’s economic landscape, emphasising the enduring disparities in income and spending patterns.

“The insights from the survey offer a detailed picture of household spending and economic inequality. They highlight the need for targeted interventions to address the disparities, particularly those rooted in regional, gender and racial differences,” said Stats SA.

The IES is designed to offer reliable data on poverty, inequality and income patterns, and to inform future updates to the consumer price index.

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