The average net wage in Romania increased by 7.0% y/y in June to RON 5,539 (EUR 1,097), easing to the slowest annual growth rate since November 2021, according to data published by the statistics office INS on August 13. In real terms, the annual growth rate eased to 1.3% y/y, the weakest advance in more than two years.
In the entire second quarter of the year, the average net wage increased by a real 2.4% y/y, down from +4.8% y/y in Q1 and +7.4% y/y in 2024.
The consumer price hikes in July and August will result in negative growth rates of the real net wages for the first time since the 2022 inflationary shock prompted by the war in Ukraine and subsequent surge in energy prices. The governments and companies’ reluctance to provide wage hikes under the prevailing gloomy macroeconomic circumstances may keep the real growth rate in the negative territory for at least the second half of the year, with a negative impact on consumer confidence and budgets, hence the private consumption and economic growth.
Compared to the average 1.3% y/y advance of the average net wage in real terms, the wages in sectors dominated by the budgetary sector have posted negative dynamics: -4.7% y/y in education, -3.2% in health care, and -3.2% y/y in public administration.
Wages in the budgetary sector are supposed to remain flat nominally by the end of 2026, which would result in a significant contraction in real terms.
The wages in construction (-2.8% y/y) and IT&C (-5.9% y/y) were impacted by the elimination of the fiscal allowances this year.
In manufacturing, however, the wages posted an average real +5.0% y/y advance. The rise was driven by the crude oil processing (+12.9% y/y), automobile production (+10.0% y/y) and the manufacturing of other transport means (+12.7% y/y).
iulian@romania-insider.com
(Photo source: Aaron Amat/Dreamstime.com)
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