The Baltic Course
October 1, 2008
The difference between salaries for workers in Ireland, compared with Latvia, has reduced by 25% in the past (2007) year’s time, reveals a survey carried out by the international company Hay Group.
Disregarding the smaller salary difference, Ireland remains an attractive destination for job seekers, working low-qualification jobs in agriculture, production, tourism and entertainment sectors, reports LETA.
Latvia proves to be increasingly more competitive with Ireland regarding the employees salaries, especially vis a vis high level experts and managers as their salaries in the two countries are practically at the same level.
The report concludes that the highest inflation among the countries, included in the study, is in the Baltic States and Russia. the lowest inflation rate was observed in the United Kingdom, Ireland and Brazil.
Residents of Estonia have the best financial conditions in the context of the three Baltic States, Estonia is also the country with the highest standard of living among all central- and eastern European countries, whereas Bulgaria and Romania score the lowest results regarding residents’ welfare; UK and Ireland are the leaders regarding the standard of living. The average standard of living in Russia is significantly lower than in Latvia. India accounts for the overall lowest welfare level.
Analysis of the unemployment rate shows that it is relatively high in Latvia, but it could significantly reduce in the future, which would consequently result in labor shortage and continued increase of salaries.
The income analysis reveals that highly qualified experts and workers are most likely to leave Latvia, looking for job opportunities abroad in Ireland and the United Kingdom as these groups receive significantly higher remuneration abroad than in Latvia.
Analyzing the remuneration for medium level management, it has been concluded that in terms of net salary, Latvia places eighth among the 12 countries, in which the survey was carried out. It was established that, when comparing the net salary and the cost of living, Latvia stands very close to Ireland, Romania and United Kingdom, therefore medium level managers do not have many reasons to immigrate to these countries in search of work.
In terms of money, in 2008, the average annual gross wage for experts in Latvia was EUR 21,000 (LVL 14,700), in Ireland – EUR 51,000 (LVL 35,700). The average annual gross wage for top-level managers in Latvia in 2008 was almost EUR 52,000 (LVL 36,400) and EUR 100,000 in Ireland (LVL 70,000).
Taking in consideration the local cost of living, and the actual amount of money that the people can spend for their personal interests after paying off the bills, the situation is the best in Romania, Lithuania and Russia, therefore top-level managers could be interested to look for job in these countries. The cost of living is significantly higher in the UK.
After “paying the bills”, top level managers in Latvia have more money left than top level managers in Estonia and UK.
Whether Latvia will reach the European salary level, will depend on the government’s decisions and actions and on the long-term development strategy until the year 2030.
Representative of the Hay Group Liga Rode prognosticated that Latvia will manage to reach it, because the salary level difference between Latvia and other European countries continues to shrink.