Romania’s National Forecast Commission has proposed, through the Economic Programming Council, further increases of the minimum wage in the local economy, phased, until the end of next year, the first increase being scheduled for October 1, 2019, Adevarul reported.
“The increase of the minimum wage has a positive impact on the long-term growth potential of the economy. The increase of the minimum wage stimulates the consumption and the aggregate demand and implicitly the economic growth. The increase in the minimum wage has an insignificant impact on inflation and its effects surface after about a year,” reads a note of the Forecast Commission, posted on its website in October last year.
According to the minimum wage hike schedule, from October 1 this year, the minimum gross salary for people without higher education should rise from RON 2,080 as it is now, to RON 2,250 (+8.2%) while for people with higher education it should rise from RON 2,350 to RON 2,520 (+7.2%).
The rise is roughly twice the annual inflation estimated to drop below 4% toward the end of this year and later toward the end of 2020.
A second increase of the minimum wage in the economy should take place on October 1, 2020, when the gross minimum wage in the economy for persons without higher education would reach the value of RON 2,430, and for the persons with higher education the value of RON 2,700.
The average net wage in Romania increased to RON 3,142 (EUR 665) in June, up 15.5% compared to the same month of 2018....