In the 4th quarter and also for the whole year 2022, real wages recorded the sharpest drop in the last 22 years

The average monthly wage in Slovakia has decreased in real terms for the fourth consecutive quarter. Rapidly increasing inflation devalued it by 4.5% for the whole year and by almost 8% at the end of the year. Average gross wages continued to grow in the last quarter, but at the slowest rate among all quarters of the last year.

In the 4th quarter of 2022, the average nominal monthly wage of employee in economy of the SR increased by 6.5% year-on-year to EUR 1,418. On a gross basis, employees received on average by EUR 87 more than in the 4th quarter of 2021. However, consumer prices increased at a significantly faster rate, and the real wage in Slovakia dropped by 7.6% year-on-year, which was the highest decrease since the 2nd quarter of 2000. At that time, it represented a decrease of 8.4%. Seasonally adjusted average wages increased by 0.5% compared to 3^rd quarter of 2022.

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In the last quarter of the previous year, year-on-year growth in the average nominal wages was recorded by almost all monitored sectors of the economy. Exceptions were e.g. employees in health care and social work activities, whose wages increased by extraordinary bonuses and overtime for work during the pandemic in 2021. One-time bonuses paid at the end of 2021 also caused a year-on-year decline in gross wages of employees in education sector in the 4th quarter of 2022.

Employees of these two sectors also felt the most significant drop in real wages at the level of 14 to 15%, i.e. almost twice as high as the average for the whole economy of the SR. The real wages of employees decreased only minimally (up to 1.5%) in real estate and in two sectors with long-term low wages - in construction and also in accommodation and food service activities. These economic activities recorded the most significant increase, by more than 13.5% in the average nominal wage, which was able to largely compensate the employees for the effects of inflation.

Among the sectors with the largest number of employed persons during the 4th quarter of 2022, only trade was able to face the inflation rate, in which a growth of nominal wages accelerated to 10.6% (to EUR 1,329) in the last three months. The real decrease in wages reached 4%, which was less than the average for the whole economy of the SR. In industry, year-end bonuses were less generous than a year ago, as a result of which the nominal growth of wages was lower than in previous quarters, by only 6.4% (to the level of EUR 1,494), and the real decrease thus reached up to 7.6%.

Currently, the highest average monthly wage above EUR 2.2 thousand was recorded in information and communication, in electricity, gas and steam supply. In ten out of 16 sectors of the economy, the wage was lower than the average for the whole economy of the SR. The lowest average nominal wage was recorded by employees in accommodation and food service activities (EUR 809), other service activities (EUR 966) and also in construction (EUR 987).

From a territorial point of view, the nominal monthly wage was above average only in Bratislavský kraj (EUR 1,724). In other regions, it ranged from EUR 1,113 in Prešovský kraj to EUR 1,327 in Trnavský kraj and Trenčiansky kraj. In all regions, the average wage increased year-on-year, the highest by 8.5% in Trnavský kraj. However, after taking into account the effect of inflation, the real wage dropped in all regions of Slovakia. The least in Trnavský kraj (by 5.8%) and the most in Košický kraj  (by 12.2%).

The average monthly wage of employee in 2022

The average nominal monthly wage of employee in economy of the SR reached EUR 1,304 in 2022. It increased by 7.7% year-on-year, its growth rate accelerated by 0.8 percentage points compared to the same period last year. The real wage decreased by 4.5%. A drop in real wages was recorded last time immediately after the financial crisis, i.e. in 2011 and 2012.

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Average wages have increased year-on-year in all monitored sectors of the economy in nominal terms. However, none of the sectors could face the inflation rate. For the whole year 2022, real wages decreased the most in health care and social work activities (by 9.1%) and also in the education sector (by 7.2%). On the contrary, wages decreased the least year-on-year in art, entertainment and recreation (0.4%) and also in construction (by 1%). Industry, as the largest employer, recorded a year-on-year wage growth of 6.5% (to EUR 1,373), but wages fell by 5.6% in real terms.

Also in 2022, as in previous years, the average wage was above the national average only in Bratislavský kraj (EUR 1,599). In all eight regions, the average gross wage increased year-on-year and for the first time reached over EUR 1,000 at the total yearly level in all eight regions of the SR. At the same time, up to 4 regions recorded wages higher than EUR 1,200 on the total yearly level, a year ago it was only the region around the capital. However, Prešovský kraj still remains the region with the lowest average wage (EUR 1,011) in the SR. Real wages declined the least in Banskobystricky kraj (by 3.3%) and the most in Prešovský kraj (by 6.2%).