Wages and purchasing power are still increasing

31.05.2013

Data compiled by the Central Statistical Bureau of Latvia show that the average wages and salaries in the country are growing already for the third year in a row.

Changes in average monthly gross wages and salaries
(% over corresponding period of the previous year)

Compared to the 1st quarter of the previous year, gross wages and salaries in the 1st quarter of 2013 have increased by 4.2% (from LVL 466 to LVL 486); rise in public sector comprises 4.4% (from LVL 488 to LVL 510), in private sector – 4.3% (from LVL 453 to LVL 472), while growth in the general government sector constituted 5.1% (from LVL 446 to LVL 469).

Net wages and salaries (after taxes) in the 1st quarter accounted for LVL 350 – namely 72% of the wages and salaries before taxes (gross); moreover, as personal income tax since 1 January 2013 was diminished from 25% to 24%, the share of net wages increased by 1 percentage point. Growth of the net wages and salaries during the year exceeded the growth of consumer prices (0.4%) by 4.8%, thus increasing the purchasing power of employees.

Changes in average monthly wages and salaries by sector

 

Q1 2012

Q4 2012

Q1 2013

Changes, %

Q1 2013 over

Q1 2012

Q1 2013 over

Q4 2012

Total

466

494

486

4.2

-1.7

Private sector

453

474

472

4.3

-0.3

Public sector

488

531

510

4.4

-4.0

of which:

 

 

 

 

 

General government sector

446

480

469

5.1

-2.2

In comparison with the 4th quarter of 2012, gross wages and salaries in the country dropped by 1.7%. Decline in the public sector constituted 4.0%, in private sector – 0.3%, while in general government sector – 2.2%.

In the 1st quarter of this year, average monthly gross wages and salaries, calculated increasing the wage earner number by the number of unemployed persons engaged in the paid temporary public works, constituted LVL 482. Data of the State Employment Agency show that, in the 1st quarter, on average 8.6 thousand unemployed persons were participating in the paid temporary public works.

Average monthly gross wages and salaries by sector (LVL)

As compared to the corresponding period of 2012, the highest rise of wages salaries in the 1st quarter of 2013 was recorded in public administration – of 8.0%, trade - of 6.4%, information and communication – of 6.2%, construction – of 6.1%, agriculture – of 5.8%, and real estate activities – of 5.3%.

Growth of wages and salaries in the above sectors was influenced by the increase in both regular wages and salaries as well as irregular bonuses and premiums. In 2013, the highest rise in the public administration sector was observed in wages and salaries received by the employees of the Ministry of Interior and Ministry of Justice. Due to the changes of average wages and salaries in the country, also wages of Saeima deputies and other officials have risen.

During the year, no changes were recorded in the wages received by the persons engaged in water supply; sewerage, waste management, and remediation activities, while slight wage reduction was observed in administrative and support service activities – of 0.2%.

Wages and salaries in manufacturing sector have increased less than a year ago – in comparison with the 1st quarter of 2012, monthly gross wages and salaries in the 1st quarter of 2013 have went up by 3.6% (in 2012 – on average by 4.6%).

Average monthly gross wages and salaries by main kind of economic activity (LVL)

 

Q1 2012

Q4 2012

Q1 2013

Changes, %

Q1 2013 over

Q1 2012

Q1 2013 over

Q4 2012

Total

466

494

486

4.2

-1.7

Agriculture, forestry and fishing

428

468

453

5.8

-3.3

Mining and quarrying

518

541

537

3.6

-0.8

Manufacturing

427

459

443

3.6

-3.6

Electricity, gas, steam and air conditioning supply

627

710

643

2.5

-9.5

Water supply; sewerage, waste management, and remediation activities

472

521

472

0.0

-9.3

Construction

433

458

459

6.1

0.3

Wholesale and retail trade, repair of motor vehicles and motorcycles

399

420

425

6.4

1.1

Transport and storage

511

558

516

1.0

-7.5

Accommodation and food service activities

310

309

316

1.9

2.4

Information and communication

794

815

843

6.2

3.5

Financial and insurance activities

1017

998

1064

4.6

6.6

Real estate activities

396

424

417

5.3

-1.6

Professional, scientific and technical activities

593

631

595

0.4

-5.6

Administrative and support service activities

433

454

432

-0.2

-4.8

Public administration and defence; compulsory social security

547

594

591

8.0

-0.6

Education

393

417

410

4.4

-1.7

Health and social work

432

464

448

3.7

-3.3

Arts, entertainment and recreation

384

407

401

4.4

-1.6

Other service activities

396

413

409

3.1

-1.0

More information on wages and salaries in Latvia is available in the CSB database.

 

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Explanations

Data source: sample survey of individual merchants, commercial companies, State and local government institutions, foundations, associations and funds as well as administrative data sources.

Public sector is formed by central and local government institutions and commercial companies, commercial companies with central or local government capital participation 50% and over, as well as foundations, associations and funds, and their commercial companies. Data on foundations, associations and funds and their commercial activities are not included in this information.

According to the European System of Accounts (ESA 95) the general government sector includes central and local government institutions, the social security fund, enterprises controlled and financed by the central and local governments.

Changes of average monthly wages and salaries are calculated as not rounded values, i.e., considering the value in santims.

When calculating average monthly wages and salaries the number of salaried employees is re-calculated into full-time units, thus eliminating the differences in salaries paid for various workloads.

 

 

More information:
Lija Luste
Wage Statistics Section
Tel. 67366917