Wages on a downward trend

TIRANA, Feb. 12 – Average wages shrank by 5.6 percent in the third quarter of 2012 continuing their downward trend as crisis-hit sectors have stopped new hirings while demand for jobs is high. In real inflation adjusted terms, wages dropped 8 percent in the third quarter of 2012, says the central bank in its latest monetary policy report “The cut in average wages at a time when the number of those employed in the private non-agricultural sector has increased, shows that the labour market has adjusted to conditions the Albanian economy operates in through wage reduction,” says the central bank. The services sector which increased employment registered a drop in wages. The industry sector increased wages while crisis-hit construction sector continues cutting wages. Wages in the public sector rose by 7.6 percent in nominal terms and 4.7 percent in real terms in the third quarter of 2012.
Industry and post-telecommunication were the key drivers of Albania’s moderate economic growth in the third quarter of 2012 registering double-digit growth rates. The latest report published by government-controlled Institute of Statistics, INSTAT, shows the Albanian economy grew by 2.7 percent year-on-year in the third quarter of 2012 after slightly shrinking in the first trimester of the year and recovering to 2.1 percent in the second quarter.
Short-term statistics published by INSTAT show that despite top industries registering increases in their turnover indices, almost all of them cut staff, lowered wages or indexed them only to inflation.
INSTAT data show the average monthly wage for people employed both in the private and public sectors was at 34,767 lek in 2011. The average wage in the public sector climbed to 46,655 in 2011 while since mid-2012 the minimum monthly wage stands at 21,000 lek. The public sector provides only 17.7 percent of total employment in Albania. The private non-agricultural sector accounts for 27.6 percent while the private agricultural sector has a 47 percent share.
Albania’s official unemployment rate slightly increased in the third quarter of 2012 when it climbed to 13.32 percent, up from 13.30 percent in the previous quarter and 13.25 percent in the third quarter of 2011. The unemployment rate was kept at almost the same levels only thanks to the private sector which in the third quarter of the year, the peak of the tourism season, hired an extra 10,688 people compared to the previous second quarter taking the total number of employees to 272,667.