The results of a local bank's study show that optimism in the labor market regarding salary growth in the Baltic States is noticeably declining.
If in May, 11% of respondents in Estonia hoped that their salaries would increase in the coming months, now that number has nearly halved – only 6%.
According to a survey conducted in August, only 6% of residents in Estonia expect salary growth within three months. For comparison, this figure was 11% in the first quarter and 10% in the second. At the same time, 10% of residents in Estonia fear a decrease in income.
Thus, Estonia has become the only Baltic country where the number of people expecting salary growth is less than those who fear a decrease.
In Latvia, salary expectations remain more stable: 12% believe in growth, while 8% expect a decrease. In Lithuania, 15% of respondents anticipate a salary increase, while only 6% expect a reduction. However, even there, the number of optimists is at a yearly low.
Banker Edward Rebane noted that the trend is concerning. "We see more and more signs that the labor market in the Baltic States regarding salary growth is cooling down – this hasn’t happened in a long time. The situation in Estonia is particularly restrained: it is the only country where the balance of salary expectations is negative. The recent tax increases also affect the assessments of Estonian workers, making employers cautious about salary growth," noted Rebane.
