A gloomy picture emerges for households in Cyprus as they witness a demise in their purchasing power as prices and rents increase while salaries stagnate.
While Cyprus Statistical Services data show employee wages stagnating, with a mere 2% increase since 2013, rents have taken off with a 17.8% hike recorded in 2018 compared to five years back, according to a KPMG property report.
Meanwhile, according to the data of trade union SEK wages in the period 2011-2017 as a percentage of GDP followed a continuous downward trend while the net operating surplus of enterprises, that is their profits, followed an upward trend.
Quoting data acquired from SEK, Phileleftheros daily reported that while earnings of employees in 2011 were equal to 48.1% of GDP, in 2017 they were down to 43.6%.
While earnings of employees as a share of GDP followed a downward trend, company profits increased from 18.6% of GDP in 2011 to 21.4% in 2017.
Eurostat data adds to the bleak picture of Cypriot household’s finances, showing that Cyprus takes gold when it comes to the lowest savings percentage for 2017. Cyprus households appear to be spending all their monthly income.
The same data indicates Cyprus has the second highest private debt in Europe, with households and company debt exceeding 300% of the country’s GDP.