The state of the job market continues to improve, regardless of the slowing of economic growth and lower employment rate growth. Last year, the growth of average gross earnings was influenced by the increase in the minimum wage in each of the Baltic States. Average gross earnings grew the most in Latvia, by 6.8 per cent in the course of the year.
Last year, wages in Latvia grew the fastest when compared to any other post-crisis period. When compared to 2013, the growth of earnings slowed down slightly in Estonia. Average gross earnings rose 4.6 per cent in Lithuania, which was less than in the other Baltic States.
According to the Latvian statistics board, in the last five years the most productive sectors with earnings growing at the highest rate are the service sector (average earnings 49 per cent higher than in 2008), agriculture, forestry, the fishing industry (25 per cent), and real estate (24 per cent).
According to SEB Latvia’s social economy expert, Edmunds Rudzitis: “It should be noted that, for example, wages at real estate companies grew at such a rapid pace due to the state’s successful efforts in reducing tax evasion, especially in relation to payments made under the table – payments under the table were made legal, thereby improving the statistics on wages. At the same time, wages in the areas of education and public administration continue to remain at a pre-crisis level – the average income in these sectors is respectively 7.5 and 1.5 per cent lower than in 2008.
In Lithuania, the biggest increase in wages in the period during and after the crisis occurred in information and communications technology companies (37.5 per cent when compared to 2008), water supply and waste treatment (22.2 per cent), and the economic sector, which includes agriculture, forestry, and the fishing industry (17.7 per cent). According to statistics on wages, the construction sector (average salary is 10.6 per cent lower when compared to 2008) as well as public administration (2.3 per cent lower) are doing the worst.
In Estonia, wages have increased the most among the suppliers of electricity, gas, steam and conditioned air, where the average income grew 49.1 per cent when compared to 2008. In the mining industry, the average salary rose 36.8 per cent, while rising by 31.7 per cent in agriculture, forestry, and the fishing industry. In the last six months the other service sectors displayed the worst figures in the last six years, as earnings dropped by 5.8 per cent when compared to the pre-crisis period.
The full Baltic Household Outlook can be read in English, here: www.seb.ee/BHO_aprill_2015