Salaries in Croatia must rise, as nearly 70 per cent of employees receive a wage below the average, trade unions at the round table of the Union of Science and the Union of Preporod said on Tuesday.
"According to April data, the average net wage stood at around 1,550 euros, but nearly 70 per cent of employees earn a wage below the average. The question is how we can retain workers in Croatia with such low wages, especially highly educated ones," said Izabela-Delfa Mišić, an economist from the Independent Trade Unions.
In public services, education and science are among the biggest losers of the wage reform, according to Sebastijan Trosko from the Preporod Union, although more than 80 per cent of highly educated employees work in this sector.
Matija Kroškin from the Union of Science said that the government has room for increasing all wages, including through tax relief for work, which, according to him, is shown by the data on the filling of local budgets. From the trade unions, they say that the fiscal capacity of the state budget allows for increases in the salaries of public and state officials, to whom inflation this year reduces their real income, and the private sector has room for further wage growth.
"A reduction in state spending and a rise in wages below inflation are slowing the economy. Such a policy carries risks, especially if additional external or geopolitical shocks occur," warned Viktor Viljevac from the Faculty of Economics in Zagreb.
Participants at the round table also criticised the government's approach to collective bargaining, which they described as destructive and a poor example for private employers, with the assessment that negotiations are often merely formal. Darko Šeperić from the Union of Independent Trade Unions of Croatia warned that on the national and European level, demands for fiscal discipline, deregulation and belt-tightening are re-emerging.
