The average net salary in Montenegro increased from 2020 to 527 euros or 771 percent from December 46 to February of this year, while the average pension increased from 290 to 374 euros or 29 percent.
For this period, the official cumulative inflation according to the Monstat methodology was 22 percent, while the increase in food prices since December 2020 was 35 percent.
Wage growth was higher than both of these inflation rates, so it can be said that the standard of the average worker increased during this period. The increase in average wages occurred at the beginning of last year due to the "Europe Now" program, and at the beginning of this year due to the increase of wages in the public sector by about 20 percent.
Earnings in the private sector grew at a lower rate, although it cannot be precisely determined because Monstat still adheres to the old methodology of calculating average earnings, which makes it impossible to separately see the movement of earnings in the public and private sectors.
Most pensions grew at a lower rate than inflation
Although for employees it can be said that for the vast majority the standard has been increased in the past two years, this cannot be confirmed for the majority of pensioners.
The average pension increased by 29 percent, which is higher than the general inflation rate of 22 percent, but significantly lower than the food inflation rate of 35 percent, which is unfortunately what most pensioners spend their money on.
However, this average pension growth rate of 29 percent since December 2020 was achieved by increasing the minimum pension limit by almost 80 percent, but the regular adjustment of pension growth for these two years was only 19 percent.
So the incomes have been increased at a higher rate than inflation only for pensioners with minimum incomes and their pension now amounts to around 275 euros. For other pensioners, the increase was less than the general rate of inflation, and significantly lower than the increase in food prices.
The adjustment of the minimum pension did not apply to the so-called proportional pensioners, of whom there are about 11 thousand.
May pension increase of about 5,5 percent
This difference will be partially corrected with the May adjustment of pensions. Pensions are now adjusted three times a year by the sum of 75 percent of wage growth or inflation, whichever is greater, and 25 percent of the lower of those two percent. As things stand now, the pension would be adjusted to a 75 percent increase in wages in the period January-April this year compared to the amount of wages for the period September-December last year, as well as to a 25 percent increase in inflation, which in March even turned into mild deflation.
Now the average salary is about eight percent higher than at the end of last year, inflation is below one percent, which would mean that, if this trend continues in April, pensions can be expected to increase by about 5,5 to six percent for May. Thus, the total adjustment of pensions from December 2020 would amount to about 25 percent, and would be higher than the average general inflation rate for that period.
The highest wage growth in the region
Looking at countries in the region, the average salary in Montenegro grew by 46 percent, which is more than in Serbia, Bosnia and Herzegovina and Croatia.
In December 2020, the average salary in Serbia was 37 euros higher than in Montenegro, and now the Montenegrin average is 76 euros higher than the Serbian one. The average salary in Serbia increased by 23 percent for this period, that is, at a twice lower rate than in Montenegro.
In December 2020, the average salary in Montenegro was 23 euros higher than in Bosnia and Herzegovina, and now it is 153 euros higher. The average salary in this neighboring country increased by 22 percent for this period.
The average salary in Croatia was then EUR 400 higher than in Montenegro, and now it is EUR 335 higher. The average salary in Croatia grew by 19 percent in this period.
Although the average salary in this period in Montenegro had a higher growth than in these neighboring countries, pensions did not have this trend. The Montenegrin average pension is still higher than in Serbia and Bosnia and Herzegovina, but this difference has decreased for this period. In Montenegro, the average pension was increased by 29 percent, in Serbia for this comparative period by 36 percent, and in Bosnia and Herzegovina by 44 percent. This difference will be reduced with the expected increase in pensions in May.
Only in Croatia did the average pension grow by a lower percentage than in Montenegro, as it increased in this period by only 20 percent.
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