Growing salaries in public sector

Average gross salaries and wages amounted to RSD 75,296 in January 2019, while average net salaries and wages amounted to RSD 54,521.

Compared with the previous month, average gross salaries and wages increased by 4.3% in nominal terms, and by 3.9% in real terms, while average net salaries and wages increased by 4.1% in nominal terms and by 3.7% in real terms.

What is the reason for such an increase? The answer is simple – an increase in public sector salaries in January this year. The second reason is the rise in minimum wages from 143 to 155.3 dinars per hour, an increase of 8.6 per cent.

If public sector wage growth is the main cause of the January jump in average wages, it is obvious that the salaries disbursed outside the public sector rose by only 1.5 per cent, while the salaries in the public sector rose by 9.1 per cent overall.

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The Statistical Office of the Republic confirms that, in January 2019, there was an increase in civil servant salaries, i.e. in the state administration, healthcare, social work, education and culture.

Ivan Nikolic, an associate of the Institute of Economics in Belgrade, said that January’s average salary growth was expected and was the result of a wage increase in the public sector.

“The statistics show the concrete evidence of what had been announced for months, which is an increase in public sector wages. This is an important change compared to the previous time when wages were reduced. This is also a tangible, year-on-year increase which means that, compared to January 2018, the increase is 8.9 per cent in nominal terms and 6.9 per cent in real terms. If in the long run, this wage growth of six to seven per cent a year continued, the situation in the economy would be significantly changed in relation to the period of fiscal consolidation,” says Nikolić.

He adds that the economy will strongly feel the wage growth; the trade will increase and this stimulates tourism, service sector, industry and gross domestic product.

Statistics show the salaries in public administration have increased by an average of 9.9 percent, in education by 7.8 percent, healthcare and social services by 10.3 percent, information and communications by 12.2 percent, art, entertainment and recreation by 7.1 percent, the electricity, gas and steam sector by 6.1% and mining only by 1.8%.

(Politika, 28.03.2019)

This post is also available in: Italiano

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