Pay Rise Likelier for High Earners, Analyst Says

Marje Josing (ERR)
5/6/2014 1:55 PM
Category: Economy

While Estonia's average salary has doubled in 10 years, people earning less are more unlikely to get a raise and people can actually afford less despite the increase in income.

Commenting on the statistics of salaries in Estonian during 10 years of EU membership, Marje Josing, director of the Estonian Institute of Economic Research told ETV’s morning program today that this fast increase in average salary is characteristic of young states and quite rare in old European countries.

In 2004, the average salary was 446 euros, by 2013, it had risen to 955 euros. However, according to Josing, the actual average salary is lower due to the fact that many people do not consistently work 40-hour weeks. The data of the tax authorities indicates that the average salary was actually 580 euros in 2013 (according to official statistics it was 725 euros).

There is also a wide salary gap with old European states, while the difference in prices is only 20-30 percent. “People’s salaries are indeed increasing, but they can afford significantly less for the amount of money,” Josing said.

According to Josing, the sharp increase in the average salary also concerns the high end of the spectrum, as there are great numbers of people who earn little and are also more unlikely to get a raise.

The cost of food for a week for a family of four has gone up by more than 30 euros in a decade, Josing said, adding that food prices have increased around the world.

 


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