Development of wages and salaries 

Updated: 12.10.2017 - Next update: 6.2.2018

Wage and salary earners' earnings rose by 0,2 percent

According to Statistics Finlands preliminary data, the nominal earnings of wage and salary earners rose by 0.2 per cent on average in July to September 2017 when compared to the respective period in 2016. In the private sector, nominal earnings rose by 0.6 percent. As for the central government sector and the local government sector, the nominal earnings of wage and salary earners decreased by 1.0 and 1.1 percent respectively. Real earnings fell by 0,4 1) per cent on average compared to the third quarter of the previous year.

The cut in holiday bonuses agreed on in the Competitiveness Pact has been taken into account in the index of wage and salary earnings and it has a negative effect on the development of the index of wage and salary earnings in the central and local government sectors starting from the first quarter of 2017. According to Statistics Finlands preliminary data, wage and salary earners nominal earnings rose in the private sector by 0.6 per cent from July to September 2016 to the corresponding period in 2017. In the central and local government sectors, nominal earnings fell, in the central government sector by 1.0 per cent and in the local government sector by 1.1 per cent.

Statistical release

Statistics Finland / Index of wage and salary earnings

Description of indicator

The index of wage and salary earnings describes quarterly development in wage and salary earners’ average earnings for regular working hours by sector, industry and wage and salary earner group. Taxes and employee social security contributions are not deducted from average earnings. In addition, the index of wage and salary earnings data are used to calculate average data by employer sector and industry.

The development of wages and salaries is an indicator that essentially describes the nature of the labour market. As a result, growth of wages and incomes largely also reflects the prospects for the overall development of society. The development of the income level of wage earners has an impact on the activities of different sectors of society, such as the vitality of commerce and business, price increases and thereby the level of households’ purchasing power, and more widely the development of national interest rates and debt. Via spill-over effects, the development of wage earners’ incomes is reflected in the level of public sector social expenditure and through livelihood and income differences in the socio-economic position of citizens.

Alongside the development of wage earners’ nominal earnings, the development of citizens’ and households’ real incomes and earnings should be examined more widely. A broader perspective involves an examination of the development of wages and salaries relative to the rise in inflation and living costs, thereby shedding more light on the development of citizens’ living standards and livelihood. The level of wages and salaries should grow in proportion to the rise in living costs. In wage development, it is also important to examine how earnings vary between the private and public sectors and how the changing structures of the economy are reflected in the development of wages and salaries. In addition to wage levels, the development of the proportion of wage earners in society should also be analysed.

The development of wages and incomes must also be viewed as an equality issue, highlighting wage differences between the genders and different sectors of society. The wage structure of society should be fair and equal. A clear difference in the income levels of men and women is perceptible, however, and it is important to note that a wage difference is also found between workers with the same educational background and between those working in the same jobs. In recent decades, women’s earnings have approached men’s earnings, but the wage differences between the genders are still significant.

Integrating equality factors closely into public administration legislative work is central to resolving equality issues. Through equality legislation, the Government is committed in its economic and labour market policy to making inequality in the workplace more visible, for example by promoting women’s career development and removing barriers to the reconciliation of work and family life. In highlighting equality problems, it is important to understand that inequality in society is not restricted only to the income difference between men and women. Broad recognition of equality issues requires diverse equality legislation that takes the different sectors of society into account. Indeed, the mainstreaming of equality issues is also central to the public administration’s equality policy, which in practice means the integration of equality perspectives into public sector activities and decision-making.