Czech Wages Soar

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Real wages in the Czech Republic soared by 8.2% year on year in the 2nd quarter, the highest rate on record, helped by bonuses in the health sector and a wage jump across industries after a weak 2nd quarter of 2020 hit by the coronavirus pandemic.

The numbers included a 43.8% leap in wages in healthcare and social services, reflecting premiums paid for work during the pandemic. Many industries in Czechia reduced or halted operations at the onset of the pandemic in 2020, affecting wages, but that has not happened in the subsequent waves of the pandemic there.

The market had expected high wage growth, but the figure outpaced expectations. A Reuters poll had shown an average expectation of a 5.4% real wage rise, but the Czech central bank foresaw a 9.1% increase in the real wage and thus the figures do not add impetus to the bank’s expectations of further interest rate hikes in the coming months. With inflation reviving, nominal wage growth was 11.3% and average gross monthly pay reached the equivalent of EUR 1,507.

CET Editor

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