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Czech Minimum Wage Increase: Details and New Forecast

by Emma Walker – News Editor
written by Emma Walker – News Editor

Czech Minimum Wage to Rise to 22,400 Crowns⁢ in January, Boosting​ Low-Income⁤ Workers

Table of Contents

PRAGUE – The Czech Republic’s minimum wage will ⁤increase to 22,400​ crowns (approximately​ $980 ​USD) starting January 1, ​2024, representing a 1,600-crown increase from the ⁣current rate. This adjustment, based on government regulations ⁣approved last fall, will bring the minimum wage to 43.4 percent of the contry’s average wage, according to the Ministry ‍of Finance.

The⁤ increase aims to bolster the purchasing power of the lowest-paid workers, a priority for the current administration. Minister of⁣ Labor and Social Affairs, Marian Jurečka, told Czech Television (CT) that ⁢ we have been experiencing a period ​- for the last two years – when we have the greatest growth rate of minimum wage and the purchasing power of these people who have these lowest incomes are increasing. This marks a continuation of significant wage growth ⁢for this segment of the workforce.

While initial​ forecasts from the Ministry of Finance‌ in July predicted an 1,800-crown increase, the final figure settled at 1,600 crowns. ‌ This adjustment ⁢is still⁢ ample, following a 1,900-crown increase implemented earlier​ this year.

Automatic calculation and Past Context

This year marked the first time the minimum wage was ​calculated automatically, based on a formula tied to the average wage. The current rate represents⁤ 42.4 percent of the average⁤ wage predicted by the Ministry of Finance last year. Prior to this year, the minimum ⁤wage was 18,900 crowns. The increase to 20,800 crowns at the start of 2023 represented a larger jump than the upcoming adjustment.

The automatic calculation aims to provide greater stability and ⁢predictability in wage adjustments, linking the minimum wage directly to broader economic performance.

Impact on the Workforce

Approximately 118,000 Czech ‍employees, roughly three percent of the total workforce, currently earn the minimum wage. Alongside the minimum wage increase, salaries in the public sector – specifically⁣ the lowest guaranteed salaries – ‍will also see an increase of nearly eight percent.

This broader impact ⁣on public sector wages is intended‌ to address wage disparities and ensure fair compensation across different sectors‍ of the economy.

According to Novinky.cz, the government’s decision reflects a commitment to supporting low-income workers and mitigating the effects of inflation.

Disclaimer: World-Today-News.com provides news and information for educational purposes only. We do not provide financial ‍advice. Consult with a qualified financial ⁤advisor for ⁢personalized guidance.

We’d love to hear your thoughts‍ on this significant economic update!‍ Share this article with‍ your network, leave⁤ a comment below ‍with your viewpoint, or⁢ subscribe to our newsletter for more in-depth ⁤coverage of Czech news and‍ global economic trends. Let’s keep the conversation going!

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World

Minimum Wage Comparison: Europe’s Highest and Lowest Salaries

by Lucas Fernandez – World Editor
written by Lucas Fernandez – World Editor

European Minimum Wage disparities Widen, Inflation Erodes Gains

Table of Contents

Brussels, Belgium – July 26, 2024 – Meaningful discrepancies in minimum wages persist across europe, with a gap of over €2,000 separating the highest and lowest earners, according too recent data from Eurostat and Euronews. While Western and Northern European nations boast substantially higher minimum wages, Eastern and Southeastern European countries lag behind, a trend linked to varying levels of productivity, industrial structures, and worker negotiation power. Recent increases, while appearing substantial, are frequently enough outpaced by inflation, diminishing real wage gains for manny workers.

Minimum Wage Breakdown by Country (July 2024)

Analysts have categorized European countries into four income groups based on their monthly minimum wage:

  • High-Income Group: Exceeding €1,500 – Luxembourg leads with a minimum wage of €2,571 per month. Other nations in this bracket include Ireland (€2,282), the Netherlands (€2,246), Germany (€2,161), and Belgium (€2,112). France’s minimum wage stands at €1,802.
  • Upper-Middle Income Group: €1,000 – €1,500 – This group encompasses a diverse range of countries that have recently surpassed the €1,000 threshold.
  • Lower-Middle Income Group: €600 – €999 – Predominantly comprised of Eastern and Southeastern European nations.
  • Low-Income Group: Under €600 – This category includes EU candidate countries and one EU member state. North Macedonia (€584), Turkey (€558), Bulgaria (€551), Albania (€408), Moldova (€285), and Ukraine (€164) represent the lowest minimum wages in Europe.

regional Trends and Purchasing Power

A clear geographical pattern emerges, with Western and Northern Europe consistently exhibiting higher minimum wages compared to Southern, Eastern, and Balkan regions. Though,when adjusted for purchasing power parity (PPP),the disparity lessens. While Luxembourg’s nominal minimum wage is 4.9 times higher than Bulgaria’s, this difference shrinks to 2.3 times when considering PPP. Countries like Estonia, Malta, and Hungary, despite having lower nominal wages, demonstrate improved purchasing power relative to North Macedonia and Turkey.

Recent Wage Changes (January 2024 – July 2025)

Wage adjustments have varied substantially across Europe in recent months:

  • January – July 2024: North Macedonia experienced the largest increase at 7.7%, followed by Greece at 6.1%. Conversely, Türkiye saw a decrease of 21.2%, and Ukraine experienced a 9.9% reduction.
  • July 2024 – July 2025 (Projected): montenegro and North Macedonia are projected to see the most substantial increases, exceeding 20%.Türkiye and Ukraine are again anticipated to experience wage declines.
  • Eurozone Performance: Croatia recorded a 15.5% increase, while Lithuania saw a 12.3% rise. France’s minimum wage remained largely unchanged, with a 2% increase.

The observed increases are frequently offset by high inflation rates across the continent, resulting in limited real wage growth for many workers. The European Central Bank (ECB) has maintained a target inflation rate of 2%, but several countries are currently experiencing rates significantly above this benchmark. The impact of these economic pressures is notably acute in countries with lower minimum wages and higher inflation.

Source: newspaper Oxygen

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Business

Comparison of the minimum wage in Indonesia, Malaysia and Thailand, Which one is bigger?

by Chief editor of world-today-news.com
written by Chief editor of world-today-news.com


Jakarta –

The minimum wage in Indonesia and neighboring countries such as Malaysia, Singapore, Thailand, Vietnam and the Philippines varies greatly. This is how the minimum wage in Indonesia compares to other countries. Who is the greatest?

Launch ASEAN SummaryOn Monday (14/10/2024), the minimum wage increased gradually to offset the increase in the cost of living in the region and to stimulate domestic demand.

However, despite the increase, the minimum wage in most ASEAN countries is still much lower than the minimum wage in developed countries.

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In Indonesia itself, the minimum monthly average salary in 34 provinces will be between IDR 2,036-IDR 5,067 million in 2024. At the same time, Malaysia has a monthly minimum salary in 56 major cities of Malaysia of IDR 5.2 million.

The Philippines has a minimum daily wage that varies in each province, from IDR 98,000 – IDR 166,508 per day for 2024. Thailand has a minimum wage in 2024 of around IDR 156,393 for Bangkok and surrounding areas . At the same time, for other areas it set 156,859 per day.

Vietnam divides its 4 regions to set a minimum wage, there is a minimum wage of IDR 3 million per month in the urban areas of district I in Hanoi and Ho Chi Minh City. Category II rural areas from the two main cities in the country such as Can Tho, Da Nang and Hai Phong amounting to IDR 2.7 million per month.

For cities and regions of region III in the northern provinces of Bac Ninh, Bac Giang and Hai Duong, it is IDR 2.3 per month. Category IV which covers the remaining 3 categories is IDR 2.1 million per month.

Finally there is Singapore, this country actually has no minimum wage. However, Singapore has a Progressive Wage Model (PWM). This model aims to help raise the wages of low income workers through developing skills and increasing productivity.

(fdl/fdl)

2024-10-14 06:47:00
#Comparison #minimum #wage #Indonesia #Malaysia #Thailand #bigger

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News

Hampartzumyan posted a big mistake in buying a home, always check this out!

by Chief editor of world-today-news.com
written by Chief editor of world-today-news.com

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2024-10-12 14:30:00


#Hampartzumyan #posted #big #mistake #buying #home #check

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Business

Minimum wage: It will be calculated using a model similar to pensions –

by Chief editor of world-today-news.com
written by Chief editor of world-today-news.com

The government has made it clear that it wants the minimum wage to reach 950 euros in 2027. If this happens we will not only have a different minimum wage in terms of its amount but also in the way it will be calculated.

The competent committee set up by the Ministry of Labor to study a new way of determining the minimum wage is expected to soon deliver its findings to the Minister of Labor and Social Security, Niki Kerameos.

The digital tool and the minimum wage

Afterwards, this method of calculation, which will be based on a digital tool, will be incorporated into Greek legislation. But first, after the Ministry of Labor has read the conclusion and come to a conclusion, it will proceed to a dialogue with the social partners.

According to Ministry of Labor sources, the new algorithm, or better index, will take into account the economic conditions of each adjustment period. Sizes of the economy such as inflation, productivity growth, unemployment.

It is similar in a way we could say to the adjustment model that also exists for pensions today.

Negative index number

In the event that the price index will be negative due to bad economic developments, the minimum wage will not decrease but will remain constant. That is, the minimum wage will only follow an upward trend.

According to OT information, it appears that the algorithm proposed by the committee will be based on the change in the consumer price index but also on the change in the purchasing power of the general wage index.

At the same time, the Ministry of Labor is “running” for the digital tool, which will help determine the minimum wage. It is a project worth 1.3 million euros, which has been included in the projects of the Recovery Fund.

Full time employment

The contract for the work of the Ministry of Labor and Social Affairs concerns the design, development and implementation of a digital mechanism for the collection and analysis of data as well as the assurance of appropriate computer applications, in order to thoroughly extract the legal minimum wage and the legal minimum daily wage for full employment, for employees and craftsmen throughout the country.

The new digital tool will take into account elements of the labor market, the course of the economy so that the minimum wage can be determined automatically.

In this way, the minimum wage will now be independent from each political cycle of the respective government, as it will be based on the real data of the labor market and the economy.

Until now, the minimum wage is determined as follows: A written invitation is sent by the Coordinating Committee to specialized scientific and research institutions to write a report for the evaluation of the current statutory minimum wage.

The report is then drawn up and submitted by the committee and a memorandum is sent to the other representatives of the social partners.

The final suggestion

Afterwards, specialized scientific and research bodies draw up their reports to be included in the consultation conclusion, while the final recommendation on the minimum wage is made by the Minister of Labor to the Council of Ministers, who has the final say.

This whole process is therefore expected to change since technology and economic data will determine the amount of the minimum wage based on the strength of the economy.

The two directions for wages until 2027

Increase the minimum wage to 950 euros by 2027. This means an average increase of about 5%- a year in the minimum wage for the next 3 years.

From 2025, private sector workers receiving the minimum wage will see another increase of around 5% based on what the government has promised.

Average salary 1,500 euros

So far, increases in the minimum wage have generally dragged down wages to a lesser extent. However, Kostis Hatzidakis, during the presentation of the Medium Term, stated that the average salary in 2024 will close above 1,300 euros. In 2023 it was at 1,251 euros.

SOURCE: ot.gr

#Minimum #wage #calculated #model #similar #pensions

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Business

What the Medium-term Structural Plan 2025-2028 foresees for debt and incomes – 2024-10-02 20:15:45

by Chief editor of world-today-news.com
written by Chief editor of world-today-news.com

A large increase in GDP, significant primary surpluses, a reduction in unemployment to pre-crisis levels and a de-escalation of debt, the Medium-term Financial Structural Plan 2025-2028the main points of which were presented at a press conference by the Minister of National Economy and Finance Kostis Hatzidakis with Deputy Minister Thanos Petralia. And as the minister pointed out, in the medium term “we achieve fiscal stability, with debt reduction, growth and income growth”.

The Plan is forwarded with a letter from the minister to the Parliament, to be discussed on Friday in the competent Committee, in the presence of the Bank of Greece and the Fiscal Council. The final draft will then be sent to the European Commission to be approved on November 28 by Ecofin.

According to the Mid-Term forecasts:

  • Public debt will fall from 153.7% of GDP today to 133.4% of GDP in 2028.
  • The fiscal deficit (with a limit of 3% of GDP) from 1% of GDP this year, will be formed to 0.6% of GDP in 2025, to 0.8% of GDP in 2026, to 1.1% of GDP in 2027 and to 1.2% of GDP in 2028.
  • The primary budget surplus, from 2.4% of GDP this year (against an initial forecast of 2.1% of GDP) will be 2.5% of GDP in 2025 and 2.4% of GDP for each of next years.
  • The nominal GDP, from 232 billion euros will be formed to 242 billion euros in 2025, to 253 billion euros in 2026, to 263 billion euros in 2027 and to 272 billion euros in 2028. According to the minister, the forecasts these are conservative, as the Commission does not take into account the inflows from the Recovery Fund and the NSRF.
  • The percentage increase in GDP will be as follows: 2.2% this year (2.2% the EU forecast), 2.3% in 2025 (1.8% the Commission), 2% in 2026 (0.7% the EU predicts), 1.5% in 2027 (instead of the 0.7% the EU predicts) and 1.3% in 2028 (the Commission predicts 0.8%). As the minister repeated, the Commission also does not take into account the Recovery Fund and the NSRF.
  • The minimum wage will increase from 650 euros in 2019 to 950 euros in 2027 and the average wage from 1,046 euros in 2019 to 1,500 euros in 2027.
  • Unemployment will decline from 10.5% this year to 9.7% in 2025, to 9.2% in 2026, to 8.7% in 2027 and to 8.5% in 2028.

As Mr. Hatzidakis said, the Medium term also includes eight key structural interventions for: Demographics, housing, dealing with the consequences of the climate crisis, strengthening the health system, upgrading the education system, limiting tax evasion which will allow further tax reductions, strengthening entrepreneurship and reviewing spending for their more rational distribution.

For the latter, the minister indicated indicatively the targeting of social benefits, unemployment benefits, operating costs (e.g. state cars), pharmaceutical costs and the costs of General Government and Local Government bodies.

As the main medium-term target for the EU member states will be the primary net expenditure limit and not the primary surpluses, the minister pointed out that an agreement was reached between the country and the Commission – due to the better fiscal performance this year – for an additional 700 million euros in 2025 and a total of 4 billion euros over four years. This, Mr. Hatzidakis said, creates more fiscal space for pension spending, operational spending and national defense spending.

According to the minister, with the Medium Term, the following are achieved:

  • Great debt reduction.
  • Promotion of structural interventions.
  • Reducing tax evasion (estimated additional revenue of €2.5 billion in 2027).
  • Covering increased defense spending.
  • Strengthening the welfare state.
  • Reducing unemployment.
  • Lowering taxes and boosting incomes.

Concluding, the minister said that “the main message is that with the Plan we take the economy several steps higher and implement all the commitments of the ND”.

#Mediumterm #Structural #Plan #foresees #debt #incomes

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