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News

Solid wage growth in Czech Republic

4.06.2018
Company: ING Bank N.V., organizační složka

Nominal wages picked up by 8.6% YoY on the back of double-digit public sector wage growth and solid private wage increase. One more reason, why the central bank might hike sooner than expected 

Wage dynamics pushed by the public sector wage growth

As in the previous quarter, robust wage growth was seen in the non-market segments, which is influenced by 10% increase in compensation of the civil servants and 15% increase for teachers in 2H17. 

As such, wages in non-market sectors increased by 12.2% year on year in 1Q18. However, wages accelerated further also in market sectors to 7.8%. The annual dynamics itself ended slightly below the Czech National Bank's estimate of 8.1%, but the Czech Statistical Office revised the previous year's data downwards, so wage acceleration compared with 4Q17 was stronger than expected by the CNB. 

Also, results of some wage negotiations for this year have not yet come through in 1Q18 figures which is why wages might rise even more next quarter. 

Tags: Economics | Finance | Human Resources |

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