Average wages rise by 3.9 percent

06-09-2016

Average monthly wages in the Czech Republic rose in the second quarter by an average of 3.9 percent year-on-year, the Czech Statistics Office reported on Monday. The average rise of just over 1,000 crowns boosts the average to some 27,297 crowns.

Jan Bureš, photo: Tomáš AdamecJan Bureš, photo: Tomáš Adamec Earlier I discussed the result with economist Jan Bureš of Poštovní Spořitelna.

“Generally, we can say that the environment for the Czech workforce is improving and that the ongoing recovering is in a more, I would say, matured phase, therefore employers are also seeing an insufficient workforce on the market which is one reason why they are being pushed to offer better salaries at this point of the economic cycle. For some of the employers this can be a little problematic but of course it is beneficial for the workforce itself.”

Has the boost of the minimum wage by the government also played a role?

“Partly. Boosting the minimum wage and increasing salaries in the public sector have helped but the big push is from the ongoing recovery which has continued since 2013. It is more and more about improving conditions for domestic demand these days. We see one of the lowest unemployment rates in Europe and it also makes the Czech economy more resilient to external shocks than it was just two or three years ago.”

Photo: archive of Czech GovernmentPhoto: archive of Czech Government If the trend continues, will some firms find it hard going: some argue that they would have to eliminate jobs…

“I don’t believe that the cost of labour is the problem. We are more or less on the level of Slovakia; we are at 30 percent of the level which we see in Germany and in some industries productivity is not far off. What is a problem right now is that companies, even if they raise wages, are unable to find people and that is a problem when you are running ongoing projects.”

06-09-2016