Brussels, 25/08/2008 (Agence Europe) - There was a slowing in the rate of average real wage increase fin Europe in 2007 Eurofound, the European Foundation for the Improvement of Living and Working Conditions, has revealed. According to the latest report by the European Industrial Relations Observatory (EIRO), Eurofound's monitoring instrument, the average real wage increase for European workers fell from 2.7% in 2006 to 2.3% in 2007. The real wage measures purchasing power, and depends on nominal wage increases and price rises. The data gathered by the Dublin-based Community agency indicate wide differences between EU member states, both in terms of pay trends and the level of pay increases. Compared with 2006, it that wage increases in the old EU countries continued to moderate; among the member states which joined the EU at the last two enlargements (in particular, Latvia, Romania and Bulgaria) there was a clear upward trend.
Within the EU27, collective bargaining played an important role in setting nominal wages, with collectively-agreed nominal wage increases rising from 5.6% in 2006 to 7% in 2007. In nominal terms this rise is significant, but in real terms the situation is less rosy than in the past. When inflation is taken into account, the rate of real increase across the EU27 fell from 2.7% in 2006 to 2.3% in 2007. In the EU15, the average real pay increase, which stood at only 0.8% in 2006, fell to 0.2% in 2007. In the 12 new member states, the average real wage increase also fell, from 5.2% in 2006 to 5% in 2007. In the 10 new member states the average real pay increase fell from 5% to 4.1%.
However, differences in pay trends and the level of pay increases varied substantially between individual member states. Pay rises in Greece and Ireland, for example, ran far ahead of the EU15 averages in both 2006 and 2007. Among the new member states, countries such as Cyprus, Malta and Slovenia saw low increases in pay. The overall average for this group of countries was pushed up significantly by the double-digit increases in the Baltic States, Bulgaria and Romania in both years. In terms of trends, the rate of increase rose between 2006 and 2007 in 18 of the countries reviewed the EU plus Norway), remained unchanged in one country, the Netherlands, and fell in nine (Austria, Belgium, Cyprus, France, Greece, Italy, Malta, Slovenia and Spain. The report on the pay developments is available at: http://www.eurofound.europa.eu/eiro/studies/tn0804019s.htm (A.B./transl.rt)