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Monday 19.03.2018 | Name days: Jāzeps

Income of people employed in Latvia and Estonia has grown the fastest in Baltic States

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThanks to decreased labour taxes in the first half of 2015, the average net wages in Latvia and Estonia continued growing faster than gross wages. In Lithuania, average net wages increased more slowly than gross wages; in addition, growth of gross wages was the smallest among Baltic States.

Such are the results of the latest SEB Bank’s financial outlook of Baltic households.

The most rapid growth of net wages was noted in Latvia. Average net wages in Latvia reached EUR 600 in Q2 2015, which is 7.5% larger than it was in Q2 2015. In Estonia, average net wages reached EUR 871 (+7.3%), which is also the highest index. In Lithuania, net wages drew 4.4%, reaching EUR 554. The growth rate of gross wages in Latvia was 6.6% in Q2 2015 (5.8% in Estonia and 4.6% in Lithuania).

Growth of net wages and low inflation had a positive impact on finances of household. In Estonia, average actual wages (average net wages with changes of consumer prices) was 7.3% larger in Q2 2015 than it was one year ago. Actual income of employed people in Latvia and Lithuania grew 6.6% and 5.1% respectively. SEB Bank economic expert Edmunds Rudzitis says: «As a result of reduced prices on energy resources and food products, inflation remains low. With that, income of employed people and their purchasing power both improved. This helps stimulate consumption, which is currently the main economic engine of Baltic States. Expenses on food, transport and accommodation in Baltic States are currently lower than they were one year ago. One exception is housing expenses in Latvia. This is because electrical energy has become more expensive this year. Electricity prices now almost completely compensate the decline of prices on other utilities. The 18% reduction on fuel prices in Baltic States allowed households to reduce transport costs by 6-9% on average. Heating energy has also become cheaper, so expenses are planned to be lower than were in the past.»


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