From today, April 1, 2023, the new minimum wage comes into force, which, with the latest increase of 9.4%, is 780 euros.
Along with the minimum wage, there is also an increase in the minimum daily wage, which goes to 34.84 euros (a total increase of 5.8 euros). The minimum daily wage from 29.04 euros in February 2019, increased to 29.62 euros in January 2022, and to 31.85 euros in May 2022, and today it was increased again.
At the same time, the increase in the minimum wage, which, at the moment, concerns 585,000 workers in the private sector, entails an increase in the unemployment benefit, which, as of today, April 1, 2023, is 479 euros per month from 438 euros in May 2022, 407 euros in January 2022 and 399 euros in February 2019. The cumulative increase in unemployment benefit from 2019 is 80 euros per month.
According to government announcements, from 2019 to date, the minimum wage has increased cumulatively by 20%, from 650 euros in February 2019, to 663 euros in January 2022, to 713 euros in May 2022 and to 780 euros in April 2023 (a total increase of 130 euros). As reported, if the gifts and leave allowance are taken into account, the minimum wage on a twelve-month basis is 910 euros, or 151.7 euros per month more than in 2019.
Regarding net earnings, the Ministry of Labor and Social Affairs clarifies that the net salary after taxes and contributions amounts to 667 euros per month (778 euros with gifts and leave allowance) from 548 euros in 2019 (639 euros with gifts and leave allowance ). In total, minimum wage workers will receive three more net wages compared to 2019 on an annual basis, as annual earnings rise from €7,667 in 2019 to €9,336 in 2023 (plus €1,669 or 21.8% ).
Those who had completed at least three years in their work, until February 14, 2012, have additional earnings, which can reach up to 30%, depending on the years of service.
Increase in average earnings in 2022
At the same time, according to the data of the “ERGANI” Information System, the average salaries in 2022 increased by 12.4% compared to 2019.
According to the Ministry of Labor and Social Affairs, with the increase decided, Greece rises to 10th place among the 22 EU member states that have a minimum wage, from 13th place previously and, in terms of purchasing power, it rises to 13th position from 18th previously.
As it typically states, the significant and fair increase in the minimum wage, from April 1, 2023, “supports the income of workers, especially low-wage workers, who have been affected by imported inflation, without exceeding the capacities of businesses, which are also affected by the international economic crisis and the increase in production costs”.
As announced, “to determine the minimum wage, the reduction of unemployment from 17.5%, in the summer of 2019, to 10.8%, in January 2023, the growth of the economy, which is expected to continue, were taken into account this year, rising exports and high inflation. On the other hand, figures such as productivity, competitiveness, but also the increase in business costs were taken into account, so that the decision is indeed sustainable.”
Which benefits are affected?
In addition, with the increase in the minimum wage, aids and allowances based on the minimum wage or daily wage are adjusted. These include, among others, the unemployment benefit for the self-employed, the new job programs, the special end of unemployment benefit, the benefit due to suspension of work, special seasonal benefits for employees in the tourism and food industry, builders, forest workers, etc. ., the special maternity benefit, the parental leave allowance, the unpaid wages, due to the insolvency of employer, the provision of availability, the compensation of students in the Vocational Apprenticeship Schools of the Public Employment Service (DYPA), the compensation for work experience programs, etc.
Indicatively, the allowances, after the increase in the minimum wage, are structured as follows:
Allowance-Amount
1. Aid for the self-employed: Monthly unemployment benefit (479 euros).
2. Special maternity benefit: Minimum salary (780 euros).
3.Parental leave allowance: Minimum salary (780 euros).
4. Unemployment benefit: 13 daily allowances (249.08 euros).
5. Aid for a three-month stay in the unemployment registers: 15 daily allowances (287.4 euros).
6. Allowance for those released from prison: 15 daily allowances (287.4 euros).
7. Temporary work: 20 daily allowances (383.2 euros).
8. Insolvency of employer: Up to 3 salaries.
9. Season of builders: 70% of the 37 sq. days/years (902,356 euros).
10. Emery season: 70% of the 50 cat. days/years (1,219.4 euros).
11. Seasonal for artists, theaters, tourism: 70% of the 25 cat. days/years (609.7 euros).
12. Other seasonal (woodworkers-resin collectors, tobacco workers, potters-ceramists-brickmakers and employees of the shipyard zone): 70% of the 35 kat. days/years (853.58 euros).
13. Work allowance: 50% of unemployment allowance (239.5 euros).
14. Compensation of EPA.S. students: 75% cat. daily wage (26.13 euros).
15. Internship allowance (IEK DYPA): 80% of the minimum wage (624 euros).
16. Gaining work experience: Minimum salary (780 euros).
17. Community benefit programs: Minimum daily wage.
18. Employment programs: Subsidy 50%-90% of the minimum wage.
19. For working students participating in exams: 30 credits. daily wages for undergraduates (1,045.2 euros)/10 cat. daily wages for postgraduates (348.4 euros).
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**Interview with Dr. Maria Vasiliou, Labor Policy Expert**
**Interviewer:** Good afternoon, Dr. Vasiliou. Thank you for joining us today to discuss the recent minimum wage increase in Greece.
**Dr. Vasiliou:** Good afternoon! It’s a pleasure to be here.
**Interviewer:** On April 1, 2023, Greece saw a significant increase in the minimum wage to 780 euros. What are the primary factors behind this decision?
**Dr. Vasiliou:** The government considered several factors when determining this increase. Key among them was the reduction in unemployment from 17.5% in 2019 to 10.8% in early 2023, as well as improvements in economic growth and exports. Additionally, the impact of inflation was a significant consideration; it was crucial to support low-wage workers who have been struggling with rising living costs.
**Interviewer:** It sounds like this increase is aimed at helping low-income workers. Can you elaborate on how many people it affects?
**Dr. Vasiliou:** Absolutely. The increase in the minimum wage impacts around 585,000 workers in the private sector, which is a substantial portion of the workforce. Moreover, it also leads to an increase in unemployment benefits and other wage-related supports, making it a holistic approach to worker support.
**Interviewer:** Regarding the broader economic context, how does Greece’s new minimum wage compare to other EU countries?
**Dr. Vasiliou:** With this increase, Greece has moved from 13th to 10th place among the 22 EU countries that have a minimum wage. In terms of purchasing power, it climbed from 18th to 13th place, which is a positive development for our economy and workers.
**Interviewer:** Beyond the minimum wage itself, what other benefits are affected by this increase?
**Dr. Vasiliou:** The increase also adjusts various aids and allowances tied to the minimum wage, such as unemployment benefits, parental leave allowances, and employment programs for seasonal workers. This ripple effect amplifies the positive impact of the wage increase across multiple sectors.
**Interviewer:** Considering the need for businesses to remain sustainable, how does the government ensure this increase does not put too much strain on them?
**Dr. Vasiliou:** The government is keenly aware of the need to balance worker support with the capacities of businesses. They took into account not just economic growth, but also productivity and competitiveness, alongside rising production costs. The goal is to ensure that while we support low-income workers, we do so without jeopardizing the sustainability of our businesses.
**Interviewer:** Lastly, what do you see as the long-term implications of this wage increase for Greece’s economy?
**Dr. Vasiliou:** In the long term, this wage increase could potentially lead to greater consumer spending, which would stimulate economic growth. Additionally, as workers feel more secure and supported, we might see improvements in productivity and morale in the workplace. it’s a strategic move towards a more equitable labor market.
**Interviewer:** Thank you so much, Dr. Vasiliou, for sharing your insights with us today.
**Dr. Vasiliou:** Thank you for having me!
