Does wage growth imply a better living standard?
The average gross salary calculated for September 2024 was 132,783 dinars, while the average net salary (after taxes and contributions) amounted to 96,115 dinars, according to the Statistical Office of the Republic of Serbia (RZS). Half of the employees in Serbia earned 75,117 dinars, which represents the median net salary.
The growth of gross and net salaries in the period from January to September 2024, compared to the same period last year, was 14.5% nominally and 9.3% in real terms. Compared to the same month in the previous year, the average gross and net salaries for September 2024 were 13.0% higher nominally and 8.4% higher in real terms.
Regional salary disparities
The highest net salaries were traditionally recorded in the Belgrade region, particularly in the municipalities of Stari Grad and Vračar, where average net earnings reached 170,558 and 163,757 dinars, respectively. Following these were Savski Venac with an average net salary of 158,414 dinars and Novi Beograd, where net earnings in September amounted to 155,034 dinars.
The lowest average salaries in Serbia were recorded in the Jablanica District, at 71,652 dinars. The lowest net salaries in this region were in Bojnik (63,622 dinars), while the highest were in Medveđa (76,929 dinars).
Expert insight on income inequality
Commenting on income disparities in Serbia, Professor Ljubodrag Savić from the Faculty of Economics in Belgrade highlighted several contributing factors in an interview with Biznis.rs.
“In central Belgrade, the most significant company offices have always been located. There are many foreign companies, trade firms, consultancy agencies, universities, government institutions, and public sector organisations such as Elektroprivreda Srbije. High salaries are expected in these sectors,” explained Savić. He added that salaries also depend on the industry.
However, Savić noted that income inequality exists even in Belgrade itself. For example, average wages in Stari Grad are significantly higher than in Rakovica or other suburban municipalities.
“In municipalities like Savski Venac or Stari Grad, you will find fewer factories but more sectors employing highly educated and qualified professionals, which explains the wage differences,” Savić said.
Low earnings in Bojnik: A symptom of population decline
Regarding the lowest reported salary in Bojnik (63,622 dinars), Savić described it as a sad reflection of Serbia’s population decline. He stated that it is a natural process rather than a matter of political blame. However, he noted that living costs in these regions are significantly lower, often three to four times cheaper than in areas like Stari Grad, Belgrade.
Median salary and purchasing power
The median salary of 75,117 dinars reflects the income earned by 50% of Serbia’s workforce. When viewed in euros, this amounts to approximately €700. Savić observed that this amount might not seem small in euros, but the situation changes drastically when converted into dinars and assessed in terms of purchasing power.
“The government frequently shares data, creating the impression that incomes are rising rapidly, particularly when expressed in euros. However, there’s a catch that people often overlook. The euro has remained at 117 dinars for the past 10–15 years. With inflation often outpacing salary growth in dinars, and the euro-denominated exchange rate remaining constant, the figure in euros will always appear larger. But that doesn’t necessarily mean an improvement in living standards,” explained Savić.
Long-term trends in purchasing power
Savić pointed out that looking back a decade reveals the real impact of inflation on purchasing power.
“Think about what you could buy for €100 ten years ago when converted to 11,700 dinars, compared to what you can purchase today. Whether it’s sugar, milk, or other products, the difference in value is stark,” he said.
In his view, this illustrates how the euro figure is not always an accurate indicator of economic well-being.
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