Rising inflation has led to a dramatic fall in real monthly wages in many countries, including the US, Canada and the UK.
According to the International Labor Organization’s 2022-23 Global Wage Report, the world’s real monthly wages fell globally for the first time in the 21st century.
In the year It shows a 0.9% decline in real income worldwide since the first edition of the Global Wage Report in 2008. The 2022 figure is estimated using half-yearly data.
The cost of living crisis is likely to dominate wage trends until the end of 2023, the report suggests.
Here are the highlights of the Global Salary Report:
In North America, real wages have fallen in the European Union
In many countries, job retention plans and wage subsidies protect employment and wage levels during the pandemic. However, many of these government programs have now ended and working class people around the world are paying the price.
In Canada and the United States, average wage growth is projected to drop to zero in 2021 and to 3.2 percent in the first half of 2022, the second-lowest of any region in the study.
Meanwhile, real wage growth is expected to rise to 1.3 percent in the EU in 2021, but will slow to 2.4 percent in the first half of 2022.
Real wage growth in Latin America and the Caribbean slowed to 1.7 percent in the first half of 2022.
Meanwhile, Eastern Europe was the most affected region. In Eastern Europe, real wage growth increased to 3.3 percent in 2022 from 4.0 percent in 2020 and 3.3 percent in 2021, the largest decline of any region.
Asia, Arab countries will lead regions with positive wage growth in 2022
Despite the overall decline, there were regions that saw positive wage growth this year.
Real wage growth in Asia and the Pacific is expected to increase to 3.5 percent in 2021. Although the report predicts that growth will slow in the first half of 2022, real wage growth will still increase by 1.3 percent in the region. Even excluding China from the results, real wage growth in Asia and the Pacific was 0.7 percent in the first half of 2022.
Central and Western Asia also experienced positive wage growth for the second straight year. Real wage growth rebounded strongly to 12.4 percent in 2021, but slowed to 2.5 percent in the first half of 2022.
Real wage growth in Africa has slowed to 1.4 percent in 2021, but this number will return to zero in the first half of 2022 from 0.5 percent.
Meanwhile, estimates indicate low wage growth in Arab countries. Wage growth rose from 0.5 percent in 2021 to 1.2 percent in 2022.
- Eastern Europe: -3.3%
- USA and Canada: -3.2%
- European Union: -2.4%
- Latin America: -1.7%
- Africa: -0.5%
- Asia and the Pacific: +0.7%
- Arab countries: +1.2%
- Central and Western Asia: +2.5%
By 2022, women are more likely to be unemployed than men.
The global energy crisis, caused in part by the war in Ukraine, is causing an alarming drop in real monthly wages in many countries.
According to the report, the crisis is affecting the purchasing power of the middle class, particularly affecting low-income households.
These households are forced to spend more of their income on essential goods and services, which generally experience higher price increases than non-essential goods.
Covid-19 has had a significant impact on wages, with salaried workers missing an average of six weeks of pay in 2020-21.
The wage report also found that women overall lost more jobs than men in 2022 and during the Covid-19 crisis.
In fact, since the second quarter of 2020, the global employment rate for women has decreased by 1.2 percent compared to men.
Advanced G20 countries experienced declines in real wages.
Accelerating inflation has rapidly eroded the minimum wage in many countries, including many developed countries.
Indeed, advanced G20 countries have been some of the hardest hit by inflation over the past two years.
Among advanced G20 countries, real wages are projected to decline by 2.2 percent in the first half of 2022.
On the other hand, real wages in developing G20 countries grew by 0.8 percent. While growth in developing countries was encouraging, it was still 2.6 percent lower than in 2019, the year before the Covid-19 pandemic.
As a result, the recent global economic downturn has erased some of the gains made by some countries since the last financial crisis in 2008.
Between 2008 and 2022, real wage growth among all G20 countries was highest in China, where real monthly wages were equal to 2.6 times real wages in 2022. In four countries (Italy, Japan, Mexico and the UK) real wages were lower in 2022 than in 2008.
The report estimates average wages in both advanced and emerging G20 economies.
Workers in advanced G20 countries earn an average of $4,000 per month, compared to nearly $1,800 per month for workers in developing G20 countries.
The USA and Canada are among the countries most affected by inflation
According to the data, Hungary is expected to see significant growth in 2022, with real wages growing by a healthy 12.4 percent. Australia (5.0%), Serbia (3.5%) and Vietnam (3.4%) are among the countries with the highest real wage growth.
On the other hand, Nicaragua has been hit hard by inflation, with wages falling by 7.6 percent in 2022. Poland (-6.9%), Brazil (-6.9%) and the Czech Republic (-6.8%) also showed significant declines in real terms. Many other developed countries landed in the bottom-10 while wage growth increased.
Italy (5.0%), Spain (-3.5%), Sweden (-3.4%), and Canada (-3.4%) are among the developed countries hardest hit by inflation.
The United States just missed out on the bottom 10, and real wage growth fell by 3.2 percent, the 11th worst of any country in the study.
In the year Here are the top-10 and bottom-10 countries for real wage growth in 2022.
Top 10 Countries in Real Wage Growth (2022)
- Hungary: 12.4%
- Australia: 5.0%
- Serbia: 3.5%
- Vietnam: 3.4%
- Argentina: 2.2%
- China: 2.0%
- Republic of Korea: 1.1%
- China: 0.5%
- Finland: 0.4%
- Tajikistan: 0.0%
Bottom-10 Countries by Real Wage Growth (2022)
- Nicaragua: -7.6%
- Poland: -6.9%
- Brazil: -6.9%
- Czech Republic: -6.8%
- Italy: -5.9%
- Netherlands: -5.0%
- Denmark: -3.5%
- Spain: -3.5%
- Canada: -3.4%
- Sweden: -3.4%
The real wage growth data (%) for countries with data for 2022 in the study can be found in the table below.
| Country | In 2006 | In 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Hungary | 4.1 | – | 1.3 | -3.5 | -3.4 | 1.3 | -0.9 | 1.7 | 3.2 | 4.4 | 5.7 | 10.3 | 8.3 | 7.8 | 6.2 | 3.4 | 12.4 |
| Australia | 1.0 | 2.1 | -0.7 | 2.6 | 2.4 | 0.5 | 2.5 | 1.5 | -1.0 | -0.1 | 0.5 | 0.0 | 0.7 | 1.0 | 2.7 | -0.9 | 5.0 |
| Serbia | 11.4 | 14.8 | 3.9 | 0.2 | 0.6 | 0.1 | 1.0 | -1.9 | -1.7 | -2.4 | -1.7 | 0.9 | 3.9 | 8.4 | 7.8 | 5.2 | 3.5 |
| Vietnam | 8.0 | 4.5 | 14.1 | 14.1 | -3.7 | 3.9 | 10.9 | 2.9 | 4.3 | 4.8 | 4.3 | 4.1 | 3.7 | 13.2 | -4.1 | -3.5 | 3.4 |
| Argentina | 11.6 | 12.2 | 18.2 | 13.9 | 12.1 | 18.6 | 12.8 | 15.5 | 6.9 | 6.9 | 6.9 | -4.8 | -5.6 | -10.2 | -6.0 | 2.2 | 2.2 |
| China | 12.9 | 13.1 | 10.4 | 11.0 | 9.3 | 9.1 | 9.7 | 9.0 | 6.0 | 6.7 | 5.5 | 5.9 | 7.0 | 5.6 | 4.6 | 7.6 | 2.0 |
| Korea, Republic of | 3.4 | 2.9 | -6.6 | -0.1 | 3.8 | -2.9 | 3.1 | 2.5 | 1.2 | 2.7 | 2.8 | 0.8 | 3.5 | 2.8 | -1.8 | 2.4 | 1.1 |
| Taiwan (China) | 0.2 | 0.3 | -3.4 | -3.9 | 4.5 | 1.5 | -1.6 | -0.6 | 2.4 | 2.8 | -0.9 | 1.8 | 2.4 | 1.4 | 1.6 | 1.0 | 0.5 |
| Finland | 1.8 | 2.2 | 1.2 | 1.6 | 0.6 | -1.0 | 0.0 | 0.2 | -0.5 | 0.9 | 0.7 | 0.0 | 0.9 | 0.6 | 1.7 | 1.7 | 0.4 |
| Tajikistan | 15.6 | 17.8 | 15.4 | 15.4 | 17.1 | 10.9 | 18.7 | 19.1 | 10.7 | 7.7 | 0.2 | -0.4 | 0.3 | -2.6 | 1.6 | 0.7 | 0.0 |
| Bangladesh | -0.6 | 0.5 | 1.7 | 11.5 | 1.2 | -2.7 | 2.8 | 7.0 | 2.1 | 3.3 | 3.4 | 3.1 | 0.6 | 0.9 | 0.4 | 0.5 | -0.4 |
| united kingdom | 1.7 | 0.7 | 0.8 | -0.5 | -1.8 | -3.5 | -1.9 | -0.5 | -1.4 | 1.1 | 2.8 | -0.2 | 0.7 | 1.2 | -0.1 | 0.9 | -0.5 |
| Thailand | 1.5 | 0.8 | 4.5 | -1.6 | 3.1 | 3.3 | 8.5 | 5.8 | 8.3 | 2.8 | 1.6 | -0.7 | 0.3 | 1.6 | 2.8 | -0.3 | -0.5 |
| Malaysia | 0.0 | 3.2 | -3.3 | 0.0 | 4.0 | 4.0 | 3.7 | 4.7 | 1.2 | 4.0 | 3.4 | 2.2 | 7.9 | 2.2 | -9.6 | -2.2 | -0.5 |
| Mexico | 2.9 | 1.7 | -2.5 | -3.5 | -2.6 | -2.9 | -0.5 | -0.6 | -4.3 | 0.5 | 1.3 | -2.0 | -0.3 | 1.4 | 8.2 | -0.5 | -0.6 |
| Japan | -0.2 | -0.1 | -1.9 | -1.9 | 2.3 | 0.5 | 0.6 | -0.8 | -1.0 | 0.3 | 0.2 | -0.5 | -0.1 | -0.1 | -2.2 | 1.5 | -0.7 |
| Indonesia | 1.7 | 2.9 | -2.2 | 9.0 | 1.5 | 2.9 | 2.9 | 10.1 | -4.3 | -0.4 | 19.2 | 3.5 | -0.1 | 0.2 | -7.3 | -2.2 | -0.7 |
| North Macedonia | 4.6 | 2.5 | 0.3 | 14.9 | -0.5 | -2.6 | -3.0 | -1.6 | 1.3 | 3.0 | 2.3 | 1.3 | 4.2 | 4.3 | 6.7 | 2.7 | -0.8 |
| Russian Federation | 13.3 | 17.3 | 11.5 | -3.4 | 5.2 | 2.9 | 8.4 | 4.8 | 1.2 | -9.4 | 0.8 | 2.9 | 8.5 | 4.8 | 3.8 | 3.2 | -0.9 |
| Romania | 8.9 | 14.8 | 16.5 | -1.5 | -3.7 | -1.8 | 1.0 | 0.8 | 6.4 | 10.2 | 11.8 | 12.8 | 8.0 | 8.8 | 5.0 | 1.1 | -1.0 |
| Norway | 2.3 | 4.9 | 1.9 | 1.3 | 1.5 | 2.5 | 3.2 | 1.4 | 1.1 | -1.4 | -1.1 | 0.5 | 0.3 | 1.5 | 0.9 | 0.7 | -1.3 |
| Bulgaria | 3.6 | 11.1 | 13.0 | 9.1 | 3.3 | 2.4 | 4.1 | 5.6 | 7.7 | 8.0 | 9.5 | 8.1 | 7.7 | 7.9 | 8.4 | 8.4 | -1.3 |
| Chile | 2.0 | 2.8 | -0.3 | 4.8 | 2.2 | 2.5 | 3.3 | 3.9 | 1.8 | 1.8 | 1.4 | 5.7 | 4.5 | 4.7 | 3.7 | 5.6 | -1.4 |
| Germany | -0.9 | -0.7 | -0.2 | -0.2 | 1.5 | 1.0 | 0.7 | 0.6 | 2.2 | 2.2 | 2.1 | 0.9 | 1.2 | 1.6 | -0.5 | 0.0 | -1.7 |
| France | -0.6 | 1.1 | -1.1 | 0.3 | -1.3 | 1.8 | 1.0 | 2.1 | 0.6 | 2.1 | 0.8 | 0.1 | -0.6 | 0.4 | 1.1 | -0.7 | -1.7 |
| Mauritius | -3.9 | -2.5 | -1.8 | 14.1 | 5.0 | 1.2 | 3.1 | 8.9 | 0.2 | 1.8 | 7.8 | 2.9 | 1.3 | 3.0 | 4.7 | 3.1 | -1.9 |
| Switzerland | 0.1 | 0.9 | -0.4 | 2.6 | 0.1 | 0.7 | 1.5 | 1.0 | 0.8 | 1.5 | 1.1 | -0.1 | -0.4 | 0.5 | 1.5 | -0.8 | -2.1 |
| south africa | 4.9 | 0.3 | -0.2 | 4.0 | 9.7 | 2.7 | 3.1 | 0.0 | -0.3 | 2.1 | -0.1 | 3.5 | 1.6 | 1.0 | -1.4 | 1.2 | -2.3 |
| Slovakia | 4.2 | 4.3 | 3.3 | 1.4 | 2.2 | -1.6 | -1.2 | 1.0 | 4.2 | 3.2 | 3.9 | 3.5 | 4.4 | 1.9 | -0.4 | 3.7 | -3.0 |
| Portugal | -0.1 | 0.7 | 1.9 | 3.5 | 2.6 | -2.8 | -1.6 | -0.6 | 0.1 | 3.8 | 3.8 | 0.0 | 0.6 | 2.9 | 3.1 | 2.5 | -3.1 |
| United States | 1.0 | 1.0 | -1.1 | 1.8 | 0.9 | -0.4 | 0.3 | 0.4 | 0.8 | 2.2 | 0.7 | 0.7 | 0.9 | 1.0 | 4.1 | 0.0 | -3.2 |
| Sweden | 1.4 | 0.9 | 1.8 | 3.0 | 0.4 | -0.4 | 2.1 | 2.5 | 2.8 | 2.0 | 1.5 | 1.1 | 0.4 | 0.4 | 1.9 | 0.4 | -3.4 |
| Canada | 0.5 | 2.1 | 0.5 | 1.2 | 1.8 | -0.4 | 1.0 | 0.8 | 0.7 | 0.7 | -0.9 | 0.4 | 0.3 | 0.7 | 6.0 | -0.4 | -3.4 |
| Spain | 1.2 | 1.2 | 1.0 | 3.5 | -0.9 | -2.1 | -3.0 | -1.4 | 0.1 | 1.6 | -0.1 | -1.8 | -0.6 | 1.2 | -2.3 | 3.1 | -3.5 |
| Denmark | – | – | – | – | 1.0 | -0.4 | -0.3 | 0.6 | 0.8 | 1.4 | 1.3 | 1.1 | 1.2 | 1.3 | 2.0 | 0.4 | -3.5 |
| Netherlands | 0.5 | 0.4 | 1.1 | 3.3 | -0.2 | -1.5 | -1.2 | -1.0 | 0.6 | 1.7 | 1.2 | -0.3 | 0.3 | 0.0 | 3.4 | -0.3 | -5.0 |
| Italy | 0.8 | 0.1 | -0.6 | -0.6 | 0.5 | -1.9 | -4.3 | -0.4 | 0.1 | 1.1 | 0.9 | -1.0 | 0.3 | 0.4 | -4.2 | 4.3 | -5.9 |
| Czech Republic | 3.1 | 4.4 | 0.7 | 0.2 | -0.7 | -6.5 | -1.6 | -0.7 | 1.9 | 3.4 | 3.8 | 4.5 | 6.0 | 5.0 | 2.9 | 1.7 | -6.8 |
| Brazil | 4.0 | 3.2 | 3.4 | 3.2 | 3.7 | 2.7 | 4.1 | 3.0 | 2.1 | -1.3 | -2.0 | 1.7 | 1.5 | 0.4 | 4.4 | -7.0 | -6.9 |
| Poland | 3.6 | 5.4 | 5.5 | 1.6 | 1.3 | 1.3 | 0.0 | 2.5 | 3.1 | 4.4 | 4.4 | 3.7 | 5.3 | 4.8 | 1.6 | 4.2 | -6.9 |
| Nicaragua | 3.7 | -7.3 | -10.2 | 8.5 | -0.3 | -3.2 | -1.5 | -0.4 | 3.0 | 2.8 | 3.0 | 6.1 | 0.1 | -3.5 | -3.2 | -4.3 | -7.6 |
