The minimum wage at the beginning of 2007 was €92/month in Bulgaria, the lowest in the EU, compared to €114/month in Romania. The minimum wage in Romania reached €121 by mid-June 2007, due to the intensive appreciation of the leu against the euro. Nevertheless, Bulgarians outrun Romanians in terms of purchasing power. The Purchasing Power Standard computes how much of the minimum wage EU citizens spend for the same good. Romania scored 204 points in purchasing power, the lowest level in the EU. Bulgaria follows Romania with a score of 216 points,
while the country with the highest purchasing power is Luxembourg, with 1,503 points. Other countries with high purchasing power in the EU are Great Britain and the Netherlands.
There are significant differences in the EU. The lowest minimum wage is registered in Bulgaria (€92) while Luxembourg has the highest (€1,570). Bulgaria is followed by Romania (€114), Latvia (€172), and Lithuania (€174). Luxembourg is followed by Ireland (€1,403), Great Britain (€1,361), and the Netherlands (€1,301). The minimum wage in the US amounted to €676 in January 2007.
There are also major differences in the number of people receiving the minimum wage. Data was computed for 2005. Surprisingly, first and fourth places are not Eastern-European countries as expected, but France, with 16.8 percent employees, and Luxembourg, with 11 percent. Bulgaria ranks second, with 16 percent. Even if Luxembourg has the highest minimum wage, the number of people receiving this is also large. In Romania 9.7 percent of employees receive the minimum wage.
The hourly cost of labor in Romania rose by 25 percent in the first quarter of 2007 year-on-year. The labor force cost index represents how much an employer pays an employee for an hour’s worth. The increase comes right after Romania joined the EU, which brought about significant changes in the economy. Following Latvia, which registered the highest increase of 32.6 percent, Romania ranks second among the 27 EU member states. Bulgaria, with a mere 15.9 percent increase, comes fourth, while the lowest increase was Germany, with only 0.1 percent.
