International Property News

Wages rise 7.3% in 2007

6th March 2008

The average gross monthly wage rose by Kc1,485 or 7.3 percent to Kc21,692 in the Czech Republic last year, the Czech Statistical Office (CSU) said Thursday.

The real wage was 4.4 percent higher.

It was the fastest real wage growth since 2003 when real wage rose by 6.5 percent. In 2004 it grew by 3.7 percent, in 2005 by 3.3 percent, and in 2006 by 3.8 percent.

In 1995 and 1996, real wage increased by 8.7 percent, while in 1998 it fell by 1.4 percent.

About two-thirds of Czech employees earn less than the national average.

CSOB analyst Petr Dufek said that Czech wages grew at the slowest pace last year compared with other countries in Central Europe.

On the other hand, it is true that the average wage in the Czech Republic is the highest in the region. Last year, it reached EUR781, while in Hungary it was EUR744. Slovakia has traditionally the lowest wages, the average wage a quarter lower there, while prices are slightly higher than in the Czech Republic, said Dufek.

In Q4 alone the average gross monthly wage added 6.8 percent to Kc23,435. Consumer prices rose by 4.8 percent on the year in the last quarter of 2007, and the real wage increased by 1.9 percent, the lowest growth in the past 8 quarters, statisticians said.

Last year was the most generous in the past four years in terms of real wage growth and the last quarter, with the 1.9 percent increase, showed that a period of high pay rises is nearing end, said Raiffeisenbank chief economist Pavel Mertlik.

In the business sphere the average wage rose by Kc1,525 (7.5 pct) to Kc21,853 last year, the real wage was 4.6 percent higher.

In the non-business sphere the average wage increased by Kc1,333 (6.7 pct) to Kc21,117, with the real wage rising by 3.8 percent.

In Q4, the average wage increased by Kc1,470 (6.7 pct) to Kc23,484 in the business sphere, with the real wage rising by 1.8 percent.

The average wage rose by Kc1,547 (7.1 pct) to Kc23,259 in the non-business sphere, with the real wage rising by 2.2 percent.

The average nominal wage dropped in financial intermediation (-0.4 pct) in the last quarter, and a low relative growth of nominal wages was recorded in mining and quarrying and in education (+4.6 pct for both), the highest growth was recorded in agriculture, hunting and forestry (+12.9 pct), in hotels and restaurants (+10.0 pct) and public administration and defence, compulsory social security (+8.9 pct). The highest nominal wage (financial intermediation) was roughly 2.4 times higher than the lowest nominal wage (hotels and restaurants).