Wage growth accelerates to 7.5% y/y in Estonia

Average gross wage growth accelerated to 7.5% y/y in Q3 from 6.3% y/y in Q2, the stat office reported. Thus, wage growth has returned to the rate observed over the last few quarters following the slight deviation in Q2. Real wage growth also accelerated during the quarter, reaching 3.8% y/y, up from 3% y/y in Q2 despite rising inflation. In terms of sectors, the wages in education saw the biggest increase, up by 25.7% y/y in Q3 as a result of wage hikes, followed by wages in the entertainment industry, up by 19.3% y/y. Interestingly, wages in construction slowed down to 4.3% y/y while wages in the ICT sector rose modestly by just 3.4% y/y, however, the latter come from a higher base than the others sectors. Overall, wage growth remains robust despite signs of economic slowdown in the region and this should support private consumption growth in Q4.

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