Monthly earnings decline for first time in 7 years due to inflation

Real monthly gross earnings of employees in Cyprus registered an annual drop in 2022, the first decline in seven years, showing the effect of high inflation on real incomes.

According to annual data released by the Statistical Service (Cystat), the average gross monthly earnings of employees for 2022 was €2,202, marking, in monetary terms, an increase of 7.1% year on year.

However, in real terms, earnings deflated compared with the Consumer Price Index; the average gross monthly earnings decreased by 1.2%, in the first annual drop since 2014.

Furthermore, the median gross monthly earnings of employees amounted to €1,701 in 2022 from €1,606 the year before, Cystat said.

According to the data, the average gross monthly earnings by branch of economic activity range from €918 in the Agriculture, Hunting and Forestry sector to €4,011 in the Financial and Insurance Activities sector.

Employees who received between €1,000 and €1,249 accounted for the largest share, with 15.4%.

Harmonised inflation in August returned to an upward trajectory of 3.1%, primarily due to increased food prices.

It ended a continuous 12-month decline since inflation peaked in July 2022 to a record high of 10.6%.

Despite the increase, Cyprus’ inflation is the fourth lowest in the 27-member bloc.