Malta moves up a notch

August 5, 2013

A recently Eurostat press statement showed Malta in the middle of the second group of EU countries when minimum wages are compared, it moves up a notch when purchasing power parities are considered. Other countries, such as Estonia, Lithuania, Poland and Portugal, move up by two positions while the US, which is also considered for comparison’s sake, moves up to the top group of countries.

In July 2013, Eurostat explained, 21 of the EU’s 28 member states (Belgium, Bulgaria, Czech Republic, Estonia, Ireland, Greece, Spain, France, Latvia, Lithuania, Luxembourg, Hungary, Malta, The Netherlands, Poland, Portugal, Romania, Slovenia, Slovakia, the United Kingdom and Croatia) and Turkey had national legislation setting a minimum wage by statute or by national sectorial agreement.

Monthly minimum wages varied widely, from €159 in Bulgaria to €1,874 in Luxembourg. The 21 member states concerned, together with Turkey and the United States can be divided into three groups based on the level of minimum wage on 1 July this year.

The first group includes the 11 countries with the lowest minimum wages, between €100 and €500 a month: Bulgaria, Romania, Latvia, Lithuania, the Czech Republic, Estonia, Hungary, Slovakia, Poland, Croatia and Turkey.

The second group comprises five member states Portugal, Greece, Malta, Spain, Slovenia and the United States with an intermediate level of minimum wages, from over €500 to just below €1 000 a month. Malta is estimated at around €700 a month.

The third group comprises six member states the United Kingdom, France, Ireland, The Netherlands, Belgium and Luxembourg in which the minimum wage was above €1,200 per month.

The countries in Group 1 with relatively lower minimum wages in euro also have lower price levels and therefore higher minimum wages when expressed in PPS. On the other hand, countries in Group 3 with higher minimum wages in euro have higher price levels, and their minimum wages in PPS are relatively lower. In addition, as a consequence, the breaks between the three groups are partly smoothed out when looking at minimum wages expressed in PPS.