How has inflation factored into your salary? Figure out how much they should add to you | Currently.cz

The average salary this year was more than 45 thousand crowns. In 2019, when no one had an idea that the coronavirus pandemic and the Russian attack against Ukraine would come, which caused a higher price increase, it was around 35,000 crowns. But for this money, people back then could enjoy more than today for ten thousand more.

Inflation and with it sharp drop in real wages in 2022 and 2023 caused the real value of income of workers in the Czech Republic to be about the same today as in 2018. You can find out if you are one of them or except using this calculator.

In the third quarter of 2019, the average salary was 34,127 crowns. It currently amounts to 45,854 crowns, which is 34 percent higher than five years ago. But prices have risen even more in the last five years. If salaries were growing as fast as inflation, they should reach 47,573 crowns on average today.

The biggest fall in Europe

“In the Czech Republic, inflation grew much faster than the average nominal wage in 2022 and 2023, which had a negative impact on a significant drop in real wages and thus household consumption,” explained Miroslav Novák, analyst at Akcenta .This year, though real salary in the Czech Republic has returned to moderate growth, but has yet to recover from the heavy losses from the previous two years.

Czechs cannot content themselves even with the idea that other Europeans have become poor as well. According to German data Institute of Economic and Social Research Although the purchasing power of the average salary decreased in several other European countries, the biggest drop was in the Czech Republic.

Clean up the crisis in up to two years

The unpleasant comparison is mitigated only because the calculation takes into account the total salary. When comparing the net salary, the abolition of the gross gross salary from 2021 would benefit Czech wallets.

When will real wages in the Czech Republic return to pre-crisis levels? “If I start with the assumption that the average nominal wage will increase this year by 6.5 percent year on year, inflation will increase by 2.5 percent, and in 2025 and 2026 the average nominal wage will grow at a rate of 5.5 percent and inflation will be two percent, so the average salary of the country’s purchasing power will not return to the level of 2019 to 2026,” Novák estimates, adding that this opinion refers to total income.