Czechia experiencing sharpest real wage drop among OECD countries

Real wages in the Czech Republic are falling the most out of any OECD country since the state was founded, according to an analysis by the company Cyrrus. The analysis shows that real wages fell by 8.3 percent this year and that the average Czech full-time employee would have needed to have saved CZK 40,000 during 2022 to maintain the same standard of living as they previously enjoyed.

The report says the reason for the real wage decline is high inflation caused by Russia's war in Ukraine and the resulting geopolitical conflict between the West and Russia, as well as the after-effects of the covid-19 pandemic.

Based on its statistical model, the analysis estimates that the real wage decline will manifest itself between 2022 and 2024 in an increase in the number of thefts, divorces, and suicides, as well as a rise in the number of young people who are neither in school or employed, higher alcohol consumption, and a decrease in trust in the government.