The sharp rise in the cost of living has significantly impacted Malta’s minimum wage earners whose value has fallen by 5.1%. This worrying trend emerged from an analysis carried out by ETUC (European Trade Union Council) on the strength of the Eurofound data.

It transpires that between the second quarter (April-June) of 2021 to the corresponding period of this year the real value of statutory minimum wages across Europe has fallen by 4.8%. The worst hit were employees in Latvia with a 19.2% drop while the least impact was registered in France where the real value of minimum wage dropped by just 0.6%.

Though statutory minimum wages have risen by an average of 7,6% over the last year in the 21 EU countries which have one, this rise was eclipsed by the rate of inflation which increased by an average of 12,4%. Hence, there was a net loss in real value across the board in all but three of the countries having a minimum wage.

It is only the second time since 2000 that growth in real minimum wages has fallen below zero and this cut is considerably higher – at the height of austerity in 2012, real minimum wages growth was -0,7%.

Real statutory minimum wages have fallen most dramatically since last summer in Latvia (-19%), Czechia and Estonia (-10%), and Slovakia (-8%).  

These developments have severely worsened the conditions of minimum wage workers across Europe, who were too often already unable to make end meet. Already before the start of the cost-of-living crisis, almost one worker in ten in the EU27 was at risk of poverty and 7 out of 10 minimum wage workers reported difficulty in making ends meet.

CountryMinimum wage growth %Inflation %Change to real wage %
Latvia019,2-19,2
Czechia6,516,6-10
Estonia11,922-10
Slovakia3,612,6-8,9
Lithuania13,720,5-6,7
Poland7,514,2-6,7
Ireland2,99,6-6,6
Netherlands3,29,9-6,6
Slovenia4,910,8-5,8
Bulgaria9,214,8-5,5
Luxembourg5,010,3-5,2
Malta0,96,1-5,1
Spain5,210-4,7
Portugal6,09-2,9
Romania10,813-2,1
Greece9,611,6-1,9
Croatia10,212,1-1,8
France5,86,5-0,6

The analysis of Eurostat data by the ETUC was published ahead of the final vote on the directive on adequate minimum wages in the EU in the European Parliament.

It added that the cost-of-living crisis has made the directive even more necessary while remarking that  Member States should not wait two year until transposing the directive.

The Directive will mean that:

  • Members states will have to verify the adequacy of statutory minimum wages taking into account purchasing power and the cost of living;
  • A duty on member states to promote collective bargaining and combat union busting and on countries with collective bargaining coverage below 80% to produce an action plan to support collective bargaining;
  • The strengthening of the involvement of trade unions in the setting and updating of statutory minimum wages;
  • A requirement for companies receiving public procurement contracts to respect the right to organise and collective bargaining in line with ILO Conventions 87 and 98.