Real wages rose again after a long period in the 4th quarter, but could not cover the full-year slump

In the last quarter and on average for the entire year 2023, the average monthly wage in Slovakia increased the fastest in the last 19 years. Dynamic growth together with declining inflation stopped almost two-year long slump in real wages. At the end of the year, it increased by almost 4%, but could not completely cover the declines of the first three quarters. For the whole year, the real wage decreased by less than one percent.

In the 4th quarter of 2023, the average nominal monthly wage of employee in the economy of the SR increased year-on-year by 10.6% to EUR 1,569. In gross terms, employees received an average of EUR 151 more than at the end of 2022. The fastest growth in the nominal wage in the last 19 years and decreasing inflation stopped the slump in real wages, which lasted continuously since the beginning of 2022. The real wage in Slovakia thus increased year-on-year by 3.9% in the 4th quarter of 2023. Seasonally adjusted average wage increased by 2.6% compared to the 3rd quarter of 2023.

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In the structure of the economy, all 19 monitored sectors of the economy recorded a year-on-year growth in the average nominal wage. The increase in gross wages ranged from 5.8% in office administrative activities to 17.9% in education. Thus, average wages in all sectors were able to resist inflation, with the exception of the wages of employees in office administrative activities. Employees in six sectors of the economy – e.g. in education, real estate activities and in health sector recorded a rise in real wages by more than 5%.

In the 4th quarter of 2023, among the sectors with the largest number of employed persons, industry was better able to face the pace of inflation, where the nominal growth of wages accelerated to 11.4% (to EUR 1,661). Real wage growth reached 4.7%, it was higher than the average for the entire economy of the SR. Even in trade, which employs the second highest number of persons, the nominal growth of wages was quite significant, representing 9.4% in the last quarter. The average wage of employees in trade amounted to EUR 1,454 in the last three months of the previous year, its value increased by 2.8% in real terms.

Currently, the highest average monthly wage of over EUR 2.400 was in information and communication, in electricity, gas and steam supply, as well as in financial and insurance activities. In nine out of 19 sectors of the economy, the wage was under the average value for the entire economy of the SR. Employees in accommodation and food service activities still recorded the lowest average nominal wage (EUR 887), they were the only ones who did not exceed the threshold of one thousand euros.

From a territorial point of view, the nominal monthly wage was above average only in Bratislavský kraj (EUR 1,897). In the other regions, it ranged from EUR 1,247 in Prešovský kraj to EUR 1,476 in Trenčiansky kraj. In all regions, the average wage increased year-on-year, the most dynamically by 12.1% in Žilinský kraj. After accounting for the effect of inflation, the real wage also increased in all regions of Slovakia. It rose the most in Žilinský kraj (by 5.4%) and the least in Trnavský kraj (by 2%).

Average monthly wage of employee in 2023

The average nominal monthly wage of employee in the economy of the SR reached EUR 1,430 in 2023. It increased year-on-year by 9.7%, its growth rate accelerated by 2 percentage points compared to 2022. The year-on-year growth was thus the highest since 2004. Real wages continued to decline, however, moderating to 0.7%. In the previous year 2022, wages depreciated in real terms by up to 4.5%, which was the sharpest drop in the last 22 years.

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The average wages increased year-on-year in nominal terms in all 19 monitored sectors of the economy. However, 10 of them still could not resist the pace of inflation. Real wages for the entire year 2023 decreased the most for those employed in art, entertainment and recreation (by 3.6%). On the contrary, real wages increased the most year-on-year in real estate activities (by 3.2%). Industry, as the largest employer, recorded a year-on-year growht in wages by 10.1% to EUR 1,511, but wages decreased slightly by 0.4% in real terms.

Also in 2023, as in previous years, the average wage was above the national average only in Bratislavský kraj (EUR 1,751). In all eight regions, the average gross wages increased year-on-year. At the same time, 4 regions - Bratislavský, Trnavský, Trenčiansky and Košický kraj recorded wages higher than EUR 1,300 on an annual level. A year before, it was just the region around the capital. However, Prešovský kraj still remains the region with the lowest average wage (EUR 1,111) in the SR. Real wages declined in seven regions, the most in Košický kraj (by 2.6%), and only Nitriansky kraj recorded unchanged real wages.