The average Eskom employee gets paid R870,000 per year

Eskom’s latest financial statements revealed that the average employee costs Eskom R870,000 per year, significantly higher than the average for most other companies in South Africa.

Eskom’s annual financial statements for the year ended 31 March 2024 showed that the company’s headcount increased to 40,625 at the end of the financial year.

During the 2024 financial year, Eskom’s direct costs of employment increased to R35.355 billion. This equates to R870,277 per employee per year.

What is particularly concerning is that Eskom’s employee costs have rapidly increased over the last twenty years.

At the turn of the century, South Africa had cheap and abundant electricity, which enabled heavy industry to thrive in the country.

Eskom, South Africa’s state-owned power utility, was recognized for its performance in the past, winning the Financial Times’ Global Energy Awards’ “Power Company of the Year” in 2000.

Since then, the company has faced significant challenges, including operational inefficiencies, financial strain, and reports of corruption and mismanagement.

Its electricity generation has declined compared with 2008 levels, contributing to ongoing power supply issues in the country.

Eskom has shown improvement this year, with the Energy Availability Factor (EAF) increasing from less than 60% in 2024 to a monthly average consistently over 70% in 2025, resulting in almost 150 days without loadshedding.

Analysts have also noted that Eskom has a relatively large workforce, with salaries that are higher than the industry average, which has added to financial pressures.

A World Bank policy research paper found that in 2014, Eskom had the largest workforce out of the 39 sub-Saharan African countries at 41,787.

The World Bank estimated that Eskom required a workforce of only 14,244 people to serve its customers. It proposed one employee for every 413 electricity customers.

The problem started in the early 2000s. The company increased its workforce from 29,359 in 2002 to 48,628 in 2018.

Despite this significant increase in employee numbers, there was no corresponding increase in power generation.

Above-inflation increases for many years aggravated the problem. This caused Eskom to struggle with a bloated employee cost line item.

In 2004, Eskom’s average employee cost was R297,000. Inflation-based increases would have lifted this salary to R648,000 in 2024.

However, due to Eskom’s salary increases, the average employee now gets paid R870,000 per year, much higher than what it was, in relative terms, twenty years ago.

Former Eskom CEO Andre de Ruyter comments on staff costs

Former Eskom Chief Executive Andre de Ruyter said that high employee costs are one of the reasons why electricity prices in South Africa have increased rapidly over the last two decades.

Eskom has a cost-based electricity pricing model. The higher its costs, the higher the price of electricity to cover these costs.

However, there are no competitive checks and balances to ensure that Eskom’s costs are market-related.

This means that Eskom can agree to high salary increases, and the people who pay for these high salaries are South African citizens and businesses.

De Ruyter stated that the average salary is indeed high and that there is room to decrease employee costs within the power utility.

“During my time as Eskom CEO, the number of employees decreased from around 46,000 to 38,000,” de Ruyter said.

They achieved the staff reduction without any retrenchments. “This was done through people who left Eskom and a hiring freeze,” he said.

Although it contributed to cutting costs at the power utility, De Ruyter said it is impossible to save yourself rich.

“We have to find alternative ways in South Africa to generate, distribute, and sell electricity which is more sustainable,” he said.