Should AI change how South Africans are paid?

A new report by PwC South Africa challenges the relevance of title-based pay in an AI-driven workforce, warning that rigid job hierarchies fail to reflect workers’ evolving skills and productivity gains. The consulting firm notes that AI adoption is accelerating in South Africa, with 64% of workers using AI tools in the past year—10% higher than the global average—and 19% incorporating AI daily. Productivity improvements are significant, with 90% of workers reporting enhanced work quality, yet job titles remain stagnant while roles transform rapidly. The mismatch between outdated job structures and AI-enhanced capabilities risks trapping employees in underpaid roles despite their growing expertise. PwC highlights that 70% of workers expect their jobs to change substantially within three years, emphasizing the need for a skills-based pay model to bridge this gap. Such a system would reward employees for acquiring new competencies, ensuring fair compensation aligned with their contributions. Employers also stand to benefit, as transparent pay structures tied to skills foster higher engagement and retention. The report states that clear skill-to-pay linkages sharpen performance and productivity, while strategic communication with employees ensures buy-in for the transition. South Africa’s high unemployment rate further underscores the urgency of adapting pay systems to match the demands of an AI-augmented economy. PwC’s research reveals that AI usage is reshaping work across Africa, with South African workers leading in adoption and productivity gains. However, without structural changes in remuneration, the productivity divide could widen, leaving some workers behind. The firm argues that proactive measures—such as skills-based pay—are essential to sustain competitiveness and fairness in the workplace.