Eurozone wages rise by 5.2%

But increase still fails to keep up with bloc's record-high 10.7% inflation rate

Workers in six eurozone countries are earning 5.2 percent more today than they were a year ago, according to a wage tracker, but their pay has still failed to keep up with inflation.

The Indeed Wage Growth Tracker, which is a joint project between the Central Bank of Ireland and the employment website Indeed, looks at real-time data from online job postings to produce monthly updates about wage patterns. Its latest analysis found pay has gone up in France, Germany, Ireland, Italy, the Netherlands, and Spain by an average of 5.2 percent since the end of October 2021, which compares to just 1.5 percent during 2019, the tracker's first year of operation.

The six nations analyzed are the largest economies in the eurozone, which is a grouping of 19 nations that are members of the European Union and that use the euro for currency.

The study said there is little evidence wage hikes will slow down any time soon.

"These trends align with central banks' expectations for wages to continue to grow well above prepandemic rates in the near term," the Indeed Wage Growth Tracker said.

Pawel Adrjan, an economist at Indeed and one of the report's authors, said the rate of wage growth during the past year had been "extraordinarily high", and told the Financial Times newspaper it was even faster in Germany, where wages rose by 7.1 percent. Wage growth in France was 4.7 percent, in Ireland it was 4 percent, and in Italy and Spain it was 3.9 percent. In the Netherlands it stood at 3.8 percent.

The Irish Times quoted Adrjan as saying: "While wage growth accelerated earlier this year, and employees dealing with a higher cost of living benefited from higher pay, our latest data shows signs that wage growth may be plateauing in Ireland and several other countries in Europe."

The European Central Bank, or ECB, will be closely watching the rate of wage inflation and hoping large rises do not become common, because they would contribute to fast-rising inflation, which hit a record 10.7 percent in the eurozone last month.

The EU's statistics agency, Eurostat, is less up-to-date than the tracker and its latest data shows wages rising by 4 percent in the eurozone during the second quarter of 2022.

So far, wage growth in the eurozone has been less sharp than in the United States and United Kingdom, where labor shortages have contributed to wage inflation of 6.2 percent.

Pay has been rising, in part, because unions have demanded increases that keep up with inflation, and because of a cost-of-living crisis that has been largely driven by energy and food shortages and resulting high prices.