28.01.2022

EUROSTAT: BULGARIA HAS THE LOWEST MINIMUM WAGE

As of 1 January 2022, there is a national minimum wage in 21 of the 27 EU Member States, not only in Denmark, Italy, Cyprus, Austria, Finland and Sweden.

Based on the levels of the minimum wage in euros, these 21 Member States can be divided into three main groups, according to Eurostat data.

Monthly minimum wages (before deducting all taxes and social security contributions) are below € 1,000 in 13 EU countries, and in 6 they are over € 1,500.

In January this year, 13 Member States located in the east and south of the EU had minimum wages of less than € 1,000 a month.

It is the lowest in Bulgaria (332 euros), followed by Latvia (500 euros), Romania (€ 515), Hungary (€ 542), Croatia (€ 624), Slovakia (€ 646), the Czech Republic (€ 652), Estonia (€ 654), Poland (€ 655), Lithuania (€ 730), Greece (€ 774), Malta (€ 792) and Portugal (€ 823).

In Slovenia (€ 1,074) and Spain (€ 1,126) the minimum wage varies just over € 1,000 per month, while in the other six Member States the minimum wage is over € 1,500 per month: France (€ 1,603), Germany (€ 1,621), Belgium (€ 1,658), the Netherlands (€ 1,725), Ireland (€ 1,775) and Luxembourg (€ 2,257).

By comparison, the federal minimum wage in the United States was 1,110 euros in January 2022.

It can be seen that the lowest minimum wage in Bulgaria is almost 7 times lower than the highest in Luxembourg. However, the differences are significantly smaller when differences in price levels are taken into account.

In terms of the Purchasing Power Standard (PPS), minimum wages in Member States with lower price levels become relatively higher than those in Member States with higher price levels.

By eliminating price differences, the minimum wage varies from 604 PPS per month in Bulgaria to 1,707 PPS in Luxembourg, which means that the highest minimum wage was almost 3 times higher than the lowest.

Based on this, it is possible to distinguish two main groups: group 1 with a national minimum wage above 1,000 PPS and group 2 with a national minimum wage below 1,000 PPS, according to official European statistics.

Group 1 includes Luxembourg, Germany, the Netherlands, Belgium, France, Ireland, Slovenia, Spain, Poland and Lithuania. Their national minimum wages range from 1,038 PPS in Lithuania to 1,707 PPS in Luxembourg.

The second group includes Romania, Portugal, Malta, Croatia, Greece, Hungary, the Czech Republic, Estonia, Slovakia, Latvia and Bulgaria. The national minimum wages for this group range from 604 PPS in Bulgaria to 949 PPS in Romania.

All candidate and potential EU candidate countries with a national minimum wage belong to Group 2, with minimum wage levels ranging from 401 PPS in Albania to 888 PPS in Montenegro.

According to this indicator, the United States also falls into the second group with 920 PPS.