Narly 80% of Zimbabweans neither have savings nor an emergency fund to fall back on, a new report on workers' spending patterns says.
According to a survey carried out by the Industrial Psychology Consultants (IPC) titled Employee Spending Patterns Survey Report, 76% of the participants reported that they did not have savings, with the same percentage of contributors reporting they did not have an emergency fund. The report also revealed that 84% of the participants that were also paid in RTGS dollars did not have any savings. A total 56% of the participants that were paid in US dollars also did not have savings.
The report also established that 50% of the participants did not have any savings in US dollars with 77% of the participants revealing that they did not have any US dollars in the bank.
The US dollar has become the currency of choice given its store of value compared to the Zimbabwean dollar, the sole legal trender after government banned the multi-currency regime through Statutory Instrument 142 of 2019 on June 24 this year. The Zimbabwean dollar has rapidly lost its value against the greenback as runaway inflation which is estimated to be nearly 300% wreaks havoc on the economy.
In an illustration of the informalisation of the market, the report revealed that 76% of participants in the survey got their foreign currency from the black market with only 6% accessing forex from a bank. The survey established that 55% of the participants that were paid in RTGS (Zimdollars) did not believe it was worth continuing to be employed.
Non-governmental organisations, and medicine and pharmaceuticals are dominantly paid in US dollars, according to the report. The report noted that 48% of the participants were spending most of their salaries on groceries, with 42% of the participants spending it on school fees for their children.
The survey was carried across various sectors of the economy, which include retail, tourism, construction and the financial services.
"The results further reveal that most employees in Zimbabwe are being forced to adopt a short-term mindset or culture (where money is concerned), as the majority of participants neither had any savings or an emergency fund set up. This is supported by the categories which the fewest participants spent their salaries on, namely investments, home improvement, and own education," IPC observed in its report.
"All these categories have an element of forward planning and thinking. This hand-to-mouth culture could be a result of a shortage of disposable income and/or the diminishing purchasing power of salaries in Zimbabwe.
This would then mean that these spending categories are viewed as normal and luxury goods by Zimbabwean employees."