A Glimpse of Pay and Benefits in Africa

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Author:
Warren Heaps – Birches Group LLC

Africa is a Diverse Continent

Africa is a vast continent with over 50 countries.  There is much diversity, too, amongst the people, cultures, climate, economies and businesses across the region.  Not surprisingly, there is also tremendous diversity in compensation in Africa — not only the obvious differences in actual amounts of pay, but importantly, a wide range of practices in addition to base salary.

Pay and Benefits in Africa

Birches Group recently examined the total compensation for Working Level Professionals – college graduates with five to eight years of experience and a level of technical expertise in their respective profession.  Typical positions included Accountants, Brand Managers, Bankers, Engineers, Human Resources and other occupations across ten markets in Africa.

Pay Ranges in Africa

Pay Ranges in Africa

The results confirmed the wide range of absolute pay levels – from around $40,000 to over $110,000 per year.

Allowances and In-Kind Benefits Are Important

The salary numbers only tell half the story.  In many developing countries, employers provide allowances and in-kind benefits to local staff.  These benefits include cash allowances such as 13th month and vacation bonus, as well as cash or in-kind payments for transportation, food, housing, recreational activities, and more.

Percent Allowances and In-Kind Benefits

Percent Allowances and In-Kind Benefits

Allowances and in-kind benefits provide from 8% to over 30% of the total package, depending on the country.  Therefore, it’s critical to consider these elements in designing pay packages.  To overlook these “extras” and focus just on base salary would result in a potential gap against the market.

Global Approaches Need Local Tailoring

Global employers take pride in having consistent approaches to compensation around the world.  But in developing countries, local practices and insights need to be fully considered in the broader context of the employer’s compensation strategy.  The best way to ensure your pay package is competitive is to reference a good market survey, that captures all of the elements of compensation in the market, from the leading employers present in the market.

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2 responses to “A Glimpse of Pay and Benefits in Africa

  1. Hi Warren!

    Nice snapshot. We have been working in many of these countries and quite frankly there is a dearth of data w.r.t to compensation surveys in the region. I would be interested in learning about your scope of work in Africa. The difference in salaries across countries is because of the difference in cost of living in these countries largely. In addition to quantum of pay and the structure of the pay mix are there available resources for increments and salary movements year on year available? In our experience we have found following the recommendation of organisations like AFBTE in Nigeria helpful to avoid labour unrest and compliance ease. Look forward to more of your insights.

  2. Hasan,

    Thanks for your comments. I have sent you some information about our survey programme.

    In addition to surveys, we have a Trends model which uses historical market data to predict future trends in pay movement, using a best-fit regression analysis. Clients can use the tool to develop aging factors for 12 to 18 months in the future.

    Warren