Positive economy trend to become noticeable to citizens, Labour Minister says

The aim is for the positive trend of our economy and society to continue and become noticeable to citizens themselves, Minister of Labour and Social Insurance, Yiannis Panayiotou, has said.

Speaking on 18 June, he noted that the average salary has increased by 13% over the last two years, approaching €2,500, the median wage has increased by almost 11.5% to around €1,900, and that the number of employees earning less than €1,000 has fallen by 30% over the last two years.

Responding to questions from journalists after a Council of Ministers meeting, at the Presidential Palace, Panayiotou referred to the recent data released by the European Statistical Office for the first quarter of 2025, which, he said, "confirm the positive trend in the Cypriot labour market and the effectiveness of government policy."

According to Eurostat data, he said, Cyprus recorded an increase of 4.8% in hourly labour costs, which significantly exceeds the average increase in the eurozone, which is limited to 3.4%, as well as the EU average of 4.1%.

At the same time, Cyprus is recording a positive trend in labour cost growth compared to the same period last year, i.e. this year's increase is higher than last year's and Cyprus is among the six Member States with the highest increase in hourly wages for the first quarter of 2025.

"The increase in wages exceeds the increase in the cost of living. The increase in wages is about three times higher than the increase in the cost of living for the same period, which is having a positive effect on the gradual improvement of workers' purchasing power," the Minister said.

Asked whether these figures could be used as an argument by employers for not increasing the minimum wage, Panayiotou said that the data from the European Statistical Service “are an argument for the correctness of the government's policy, which is improving wages and the quality of life of citizens.”

He added that "this course must continue so that workers' wages reflect the growth of the Cypriot economy, ensuring that the growth dividend is distributed fairly among all those involved in the productive process, both employees and employers."

Responding to a question on whether the government will propose an increase in the national minimum wage as part of the social dialogue it is committed to initiating with the social partners, Panayiotou said that the level of wages in Cyprus and the trend towards their improvement, as evidenced by the data, is clearly positive, confirming the correctness of the government's policy.

He explained that the average wage has increased by 13% over the last two years, reaching €2,500, the median wage has increased by almost 11.5%, reaching €1,900, while "the minimum wage is neither a good wage nor a moderate wage; it is the worst, lowest wage that anyone can earn in this country, and by decision of the government, it has been increased, has had a positive effect on reducing the number of low-paid workers, with the number of workers in our country earning less than 1,000 euros falling by 30% over the last two years."

He added that a review of the national minimum wage is planned for January 2026. “We have about six months until January 2026, so there is enough time to take all the necessary steps in the appropriate manner,” the Minister noted.

On issues concerning both the hotel industry and construction, Panayiotou said, in response to a relevant question, that meetings are planned following communication and consultation with the social partners, while on the subject of the dialogue on the Cost of Living Adjustment, Panayiotou said that social dialogue on the future of CoLA mechanism is ongoing.

(Source: CNA)