Salaries in Czechia already exceed 50 thousand on average, but compared to Germany they are still only half
The real value of wages has still not reached the record level from 2021, yet it continues its rapid growth. Currently it is already approaching 52 thousand crowns. From the perspective of purchasing power, however, it still does not match Western Europe.
During the first quarter, the average gross monthly wage in Czechia exceeded the threshold of 50 thousand crowns, reaching a value of 50,282 crowns, and in the second quarter it rose to nearly 52 thousand.
Real wages in our country have been rising year-on-year since the beginning of 2024. Previously, due to high inflation, they had been falling for more than two years.
"In real terms, the current average wage is comparable to 2020. We will likely only exceed the highest value from 2021 next year,"
said to ČTK chief economist of Deloitte David Marek. However, it should also be added that approximately two-thirds of people do not even reach the average wage.
The most sought-after are at 90 thousand
Which sectors are the most lucrative? The highest average wage in the second quarter was in information and communication activities, banking and insurance, where it amounted to almost 91 thousand crowns. Conversely, the lowest wages were in accommodation, catering and hospitality, where they amounted to approximately 30 thousand crowns.
"Employees in the administrative and support service activities sector have significantly improved their situation, which mainly includes employment agencies and security agencies whose wage levels are low,"
wrote Jitka Erhartová, head of the labour statistics department at the Czech Statistical Office, to LP-Life.
Prague leads
The highest wages were earned by workers in Prague, where the average wage was just under 66,500 crowns. The average wage exceeded 55 thousand in the Central Bohemian Region. In the South Moravian Region it reached approximately 50,500 crowns. The lowest wages were earned by employees in the Karlovy Vary Region, averaging 44,476 crowns.
A specific situation also exists in the Ústí Region, from where part of the qualified workers leave for better remuneration to Germany. Nevertheless, wages there grew at the second slowest pace in the Czech Republic. The local districts, together with Karviná and Bruntál, rank among the regions with the highest number of job seekers per one job vacancy.
Wages alone are no longer enough
Companies are increasingly moving away from across-the-board wage increases and focusing on targeted remuneration of key and scarce workers, as shown by a survey by the personnel agency Grafton Recruitment
"Salary remains the most important factor when deciding on a new job offer, but from the candidates' perspective, the entire package of conditions is increasingly decisive. They monitor flexibility, working hours, commuting distance, which ideally should not exceed half an hour, work environment, or opportunities for further development. Employers therefore need to think much more about the overall attractiveness of their offer when recruiting,"
stated for ČTK Martin Malo, director of Grafton Recruitment.
The gap between graduates' expectations and employers' capabilities persists. Graduates are entering the job market with higher salary expectations than a few years ago. The main reason is the fact that their living costs have significantly increased. However, employers at the same time expect that a higher starting salary will be backed by corresponding skills. Young people who have already gained practical experience during their studies, speak foreign languages and can work with digital technologies including AI tools therefore have a great advantage.
Comparison with Foreign Countries
But let's return for a moment to the actual wage levels. If we look at our eastern neighbors, we'll find that they are roughly 25 percent lower than ours. While in the Czech Republic last year they were just under 50 thousand crowns, in Slovakia it was the equivalent of less than 40 thousand. The highest earnings are in Bratislava, where it was over 47 thousand crowns.
They are much better off in Germany. There, the average wage last year reached just under 130 thousand crowns. However, it must be added that the overall taxation of labor is very high here. For the average wage, taxes and mandatory contributions paid by both the employee and employer consume almost half of the total wage costs.
When converting wages to purchasing power parity, we are doing relatively well compared to Germany, for example, because the prices of goods and services in the domestic market are still on average lower than in Western Europe.
Although wages in Germany are nominally almost 2.7 times higher than ours, after taking into account the higher cost of living there, the real purchasing power of Germans compared to Czechs is "only" roughly double and not triple. In summary: from the perspective of wage levels, we still significantly lag behind Western Europe, but compared to Eastern Europe we are still better off. The indicator that works in our favour is not the level of average wages itself, but primarily the purchasing power parity.
Sources: author's text, own research, ČTK, ČSÚ, Grafton Recruitment
