Wage, salary earnings raise by 2.5% in April-June

The nominal earnings of wage and salary earners rose by 2.5 per cent in April to June 2019 when compared with the respective period in 2018,according to preliminary data of Statistics Finland.

Real earnings rose by 1.3 per cent compared to the second quarter of the previous year, because the rise in earnings level was faster than that in consumer prices.

According to Statistics Finland’s preliminary data, the nominal earnings of wage and salary earners rose from April to June 2018 to the corresponding period in 2019 by 2.2 per cent in the private sector, by 3.4 per cent in the central government sector and by 3.8 per cent in the local government sector.

The figure examines the development of the index of wage and salary earnings (ATI) in 2015 to 2019. The private sector, central government sector and local government sector are examined, and the examination ends in the last published quarter, that is, the second quarter of 2019. The earnings development made an upturn in both the state and municipal sectors at the beginning of 2019. This is affected by the non-recurring item based on profitability paid in the central and local government sector in January 2019. Furthermore, the wages and salaries in the public sector rose due to local sectoral allowances and an overall increase, which occurred in the first half of 2019.

The index for regular earnings describes the permanent change in earnings better than the index of wage and salary earnings because it does not take into account performance-based bonuses and non-recurring items included in collective agreements. For instance, the non-recurring item based on profitability paid in the public sector does not affect the index for regular earnings. Regular earnings rose by 2.3 per cent in April to June 2019 when compared with the respective period in 2018. The growth amounted to 2.2 per cent in the private sector, to 2.7 per cent in the central government sector, and to 3.0 per cent in the local government sector.

According to Statistics Finland’s preliminary data, nominal earnings of wage and salary earners are 2.4 per cent higher in July to September 2019 than in July to September 2018. According to preliminary data, the index of wage and salary earnings 2015=100 for the third quarter of 2019 is 105.6. Statistics Finland compiles the preliminary third quarter data for the index of wage and salary earnings on the basis of the Employees Pensions Act (2006/395).

The figure examines the development of the index of negotiated wages and salaries 2010=100 in 2010 to 2019. Employer sectors total, private sector and local government sector were selected to the examination. The index of negotiated wages and salaries in the private sector remained unchanged in 2017, when there were, in practice, no contractual pay increases. The index turned upwards in the first quarter of 2018 and continued rising in the beginning of 2019.