Pay Hike for Public Sector Workers Amidst Currency Devaluation

By Enia Dube 

In a bid to mitigate the impact of the recent 42% devaluation of the Zimbabwe Gold (ZiG) currency, Finance Minister, Mthuli Ncube has announced a pay increase for public sector workers.

The move aims to restore the purchasing power of civil servants, who have been severely affected by the sharp drop in the value of the ZiG. The devaluation has triggered concerns over rising prices and inflationary pressures, particularly in the public sector. 

“We will make some adjustments to civil servant salaries to ensure that their purchasing power is restored. The government is committed to cushioning civil servants against the economic shocks caused by the devaluation,” Ncube stated. 

The pay hike comes after intense lobbying by public sector unions, including the Amalgamated Rural Teachers Union of Zimbabwe (ARTUZ), which called for salaries to be adjusted to reflect the devaluation. 

The union emphasized that the ZiG component of salaries should be automatically adjusted following the 44% devaluation. “Our members are struggling to make ends meet due to the erosion of their salaries,” said ARTUZ secretary-general, Obert Masaraure. 

The government’s decision is expected to benefit over 300,000 public sector workers, including teachers, nurses, and other essential service providers. 

While the pay hike is a welcome relief, economists warn that it may not be enough to offset the impact of the devaluation. “The government needs to address the underlying economic issues, including inflation and foreign currency shortages,” said economist, Dr. Emmanuel Fundira.

Mthuli Ncube is expected to announce additional measures to support the 2024 Monetary Policy Statement (MPS), which introduced the Zimbabwe Gold (ZiG) currency. These measures aim to promote the ZiG and stabilize the economy. 

As Zimbabwe navigates this economic storm, citizens are bracing themselves for tougher times ahead. With prices already skyrocketing and shortages looming, many fear the devaluation will wipe out gains made in recent years.