Minimum Decent Wage Was CZK 40,912 in 2022, Say Experts
63% of jobs in the Czech Republic pay wages below this minimum. Photo credit: Freepik.
Prague, April 18 (CTK) – The minimum decent gross monthly wage from a full-time job to cover the needs of an adult in the Czech Republic with a child, free-time activities and small savings, was CZK 40,912 last year, said experts from the committee which calculates the figure.
Speaking at a press conference today, they added that in Prague, the decent wage comes to CZK 42,776, mainly because of higher housing costs.
They warn that 63% of jobs pay wages below this minimum.
In 2021, the minimum decent wage was CZK 31,146 in the regions and CZK 36,717 in Prague.
The 2022 increase was mainly due to high inflation, as nominal wages rose slower than consumer prices. Thus, 800,000 more jobs fell below the minimum decent wage compared to 2021.
The minimum decent wage has thus reached the level of the national average wage, which was CZK 40,353 in the Czech Republic last year.
The minimum wage set by law was CZK 16,200 in the Czech Republic last year, but this year it was raised to CZK 17,300.
Economist Jan Bittner noted that nominal wages do not cover inflation. “We are seeing political pressure for wages not to continue to grow at such a high rate, because of the alleged threat of the wage-inflation spiral,” he added.
Women are more likely to earn below the minimum decent wage than men. 68% of women’s full-time jobs and 53% of men’s full-time jobs are paid below this threshold.
“This is due to the gender pay gap between men and women, which is above average in Europe,” Bittner said.
The minimum decent wage is calculated on the basis of current prices. It indicates the decent remuneration for a job with normal working hours to provide workers and their households with enough money to maintain a certain basic standard of living as seen by most of society. It should be able to cover the costs of food and housing, clothing, transport, health care, education and leisure-time activities and pay for other important expenses, including savings for unexpected circumstances.
The committee has been publishing this figure since 2019.
A working group of more than 20 experts on social issues, economists, sociologists and political scientists, including representatives of the Academy of Sciences, the Agency for Social Inclusion and trade unions, calculate the minimum decent wage using similar statistics that are released abroad. Their calculations are based on data from the Czech Statistical Office (CSU), ministries and other institutions.
According to one of the group’s experts, one reason for wages in the Czech Republic being below the minimum decent wage is the weaker position of employees.
“One of the reasons why the pressure for pay rises is lower in our country than elsewhere in the EU is the relatively low share of employees organised in trade unions. The weak position of workers also depends on bargaining in our country taking place mainly at the company level and not at the sector level, as is common in Germany, for example,” said Katerina Smejkalova of the Friedrich-Ebert-Stiftung, a foundation close to the German Social Democrats.