Minimum Wage Stalls at SES, Serbia’s Cabinet to Decide
Serbia’s government and unions failed to agree on the 2027 minimum wage at the Socioeconomic Council, leaving the Cabinet to set the figure by September 15. Vucic promises tax cuts for employers.
Dinar banknotes, illustration for the negotiations over Serbia’s 2027 minimum wage/ Photo: N1/Marina Pupavac
The Serbian government’s proposal to raise the minimum hourly wage from 371 to 405 dinars starting January 1, which would bring the monthly minimum wage from 64,554 to 70,470 dinars, failed to win union backing at the Socioeconomic Council (SES) session held in Belgrade on August 18, 2026. With no agreement reached, the Labor Law now leaves it to the Serbian government to set the 2027 minimum wage on its own, by September 15 at the latest.
The proposed increase amounts to a nominal 9.2%. In euro terms, the minimum wage would rise from the current 550 to 600 starting in January. The Serbian Employers’ Union accepted that figure, on condition that the tax free portion of wages rise by the same percentage. The union’s honorary president, Nebojsa Atanackovic, called the proposal realistic.
“We hope that during 2027 conditions will be in place for the minimum wage to reach 650 euros by the end of the year,” Atanackovic said.
The Confederation of Autonomous Trade Unions of Serbia (SSSS) and the United Branch Trade Unions Nezavisnost rejected the offer. Both unions are sticking to their demand that the minimum wage reach 650 euros starting January 1, 2027, rather than climbing to that level gradually over the course of the year. SSSS president Zoran Mihajlovic noted that the government had already floated that same 650 euro figure before, without giving a firm date.
“For the SSSS it is unacceptable for the 650 euro minimum wage not to take effect on January 1, 2027,” Mihajlovic said.
Nezavisnost president Cedanka Andric said no consensus was reached with the government on the proposed 9.2% increase. During the talks, both unions also asked how much public sector wages would rise in 2027, so they could gauge what figure to push for, but they did not get an answer.
Vucic Promises Relief for Employers
Serbian President Aleksandar Vucic, speaking after a tour of construction work at the University Children’s Clinic Tirsova 2 in Belgrade on August 18, said the minimum wage hike would be paired with lower taxes and contributions so the burden would not fall on employers.
“We cannot destroy the domestic economy by raising the minimum wage to a level employers would not be able to pay, so the state will take that increase upon itself,” Vucic said.
In practice, that means raising the tax free portion of wages from 34,221 to 37,369 dinars, the same percentage as the minimum wage increase itself. According to figures presented at the session, the move will cost the Serbian budget 13 billion dinars in reduced revenue.How Much Will the Minimum Wage Actually Rise?
A nominal 9.2% increase does not translate into real growth of the same size once inflation is factored in. Milica Djurdjevic Stamenkovski, Minister of Labor, Employment, Veteran and Social Affairs, said on August 19 that the raise represents real growth of 4.8%.
“That means you can buy more with that money than you could the year before, that the increase will not be eaten up by inflation, that is the point,” Djurdjevic Stamenkovski said.
Two Years of Increases, by the Numbers
Finance Minister Sinisa Mali used the session to recap the string of previous increases: 13.7% from January 1, 2025, an extraordinary 9.4% from October 1, 2025, then 10.1% from January 1 this year, and now the proposed 9.2%.
“Taken together, that is a nominal increase in the minimum wage of 49.4% over 24 months. Once inflation is subtracted, it comes to 33.5%,” Mali said.
According to Mali, fewer than 100,000 workers in Serbia currently earn the minimum wage, and with the new increase, the minimum wage’s coverage of the minimum consumer basket would climb to 117%. Mali also said that if preparations are completed in time, the government could make its decision as early as one of the coming sessions, giving employers time to adjust.
The government has until September 15 to make a final decision. The long term target set earlier, a 650 euro minimum wage by the end of 2027, remains unchanged for now, but still without a firm date for when that figure would take effect.
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