Wages rose considerably in 2023 – but so did prices

Central Statistical Bureau (CSB) data published February 28 show that in 2023 the gross average monthly wage for full-time work in Latvia amounted to EUR 1 537.

Compared to 2022, the figure increased by EUR 164 or 11.9 %. Hourly earnings before taxes went up to EUR 10.14 or by 11.5 %.

The net average wage (calculated taking labor taxes into account) amounted to EUR 1 119 or 72.9 % of the gross earnings, and over the year they have grown by 11.3 %.

However, the real increase in net earnings was just 2.2 % as a result of high inflation and numerous price rises during the year.

"The change in the average earnings in 2023 was driven by an increase in the national minimum wage from EUR 500 to 620 for full-time work (24.0 %) as well as higher maximum non-taxable minimum and the coefficient used to calculate differentiated non-taxable minimum," said the CSB.

Median monthly earnings EUR 1 225

Gross median wages and salaries for full-time work amounted to EUR 1 225 in 2023. Compared to 2022 (EUR 1 081) they have increased by 13.4 %. The net median earnings (after taxes) were EUR 905 and have risen by 12.4 % over the year.

The median is an average in the middle of the ascending or descending order of wages of the employees, i.e., half of the wages are higher than the median and the other half are lower. As the median, compared to the mean arithmetic earnings, is not influenced by extremely high or low wages and salaries, it reflects typical earnings more accurately.

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In 2023 the gross average monthly earnings in the public sector (EUR 1 553) were EUR 20 higher than in the private sector (EUR 1 533), moreover public sector had sharper earnings upturn (public of 13.1 % and private of 11.5 %). The average earnings in general government sector, which includes central and local government institutions as well as enterprises controlled and financed by the central and local government, went up to EUR 1 502 or by 12.2 %.

In terms of economic activities, the sharpest rise in the average earnings was registered in agriculture, forestry and fishing (18.2 %), energy sector (17.5 %), transportation and storage (15.5 %), public administration and defence (15.0 %), education (14.8 %) and mining and quarrying (14.3 %).

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Average earnings in Latgale 37 % lower than in Riga

In 2023, compared to 2022, the sharpest rise in the average earnings before taxes was recorded in Vidzeme (13.5 %), followed by Latgale (12.7 %) and Pierīga (12.6 %). The highest gross average earnings from full-time work were recorded in Riga (EUR 1 706) and Pierīga (EUR 1 505) while the lowest in Latgale (EUR 1 083, which is 37 % fewer than in the capital). The gap between the average in earnings in Riga and regions has narrowed in all regions. The largest drop may be observed in Vidzeme (1.5 percentage points).

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