PRAGUE (Reuters) – The Czech government sees no space to lift the minimum wage further this year, Labour Minister Marian Jurecka said on Wednesday as unions seek a 5.8% rise from July.
The minimum monthly wage rose by 1,100 crowns to 17,300 crowns ($814.42) in January.
Unions want an extraordinary 1,000 crown rise in the middle of this year to compensate for soaring prices, followed by another 1,200 crown rise from next January.
“I do not see any room for the minimum to rise once again this year,” CTK news agency cited the minister saying after meetings with unions.
Jurecka added, though, that if unions and the country’s main employers’ association agreed on it, the government would comply. The main employers’ lobby has already rejected any hike.
The centre-right government last week unveiled a broad deficit-cutting plan worth 94 billion crowns as it aims to cut the fiscal gap to below 2% of gross domestic product in 2024 following several years of record-high shortfalls.
Wage growth dynamics have been on the central bank’s radar as private sector pay in industry picks up by about 10% this year, raising risks of a wage-price spiral, according to some policymakers.
Central bankers have left their base policy rate at a more than two-decade high of 7.00% since the middle of last year, but have kept the option of another hike on the table as they battle inflation that has been in double digits since the beginning of 2022.
($1 = 21.2420 Czech crowns)
(Reporting by Jason Hovet, editing by Jan Lopatka)
