Wages exceeded productivity in 2007

Earnings increased 22.6 percent in 2007 year-on-year, while labor productivity advanced 17.8 percent compared to 2006. Nevertheless, this ratio is reversed if the reference period is changed. As such, if the starting point is the year 2002, labor productivity continues to be higher than wage growth. Consequently, in the past five years, from 2002-2007, labor productivity advanced over 175 percent compared to the dynamic of earnings, at 164.2 percent.

“Wages exceeded labor productivity in 2007 year-on-year, but without recovering from the differences registered in previous years,” according to an explanation by Adriana Ciuchea, General Manager of the INS General Department of National Accounts and Macroeconomic Syntheses.

The situation does seem to be changing this year, and wages are returning to second place in terms of growth. According to estimates by the National Prognosis Commission (CNP), the wage dynamic seems to have been powerfully tempered in 2008. While the wage growth rhythm stood at 23 percent in 2007, close to that presented by INS, CNP believes that the gross average wage will advance only 12.1 percent in 2008. This is the lowest wage rise in the past few years. In money terms, the average gross wage will reach RON 1,580 this year, compared to RON 1,410 in 2007.