[Luxembourg] How the EU’s highest minimum wage measures up

[Luxembourg] How the EU’s highest minimum wage measures up
10 Feb 2021

New data from Eurostat reveals that Luxembourg's minimum wage is the highest in the European Union. RTL examines how it measures up in real terms.

At just under €2,202, Luxembourg's minimum wage is substantially higher than Ireland’s - the country with the second-highest minimum wage in the EU - at €1,724. It is 6.6 times higher than that of Bulgaria the country with the lowest minimum wage in the EU, €332. 

It is more than twice as high as the US minimum, which at present stands at around €1,024 while as President Biden tries to push through an increase to $15 (around €12.50) per hour.

Luxembourg is the only country in the EU with a minimum wage exceeding €2,000. Five other EU countries - Ireland, the Netherlands, Belgium, Germany and France - pay minimum wages of more than €1,500.

The difference begins to shrink, however, when the cost of living is taken into account and when there is a comparison of median earnings in each country.

Considering minimum wages in relative terms; by looking at how each country's minimum wage measures up against the median gross income earned by full-time and full-time equivalent employees, the difference between the countries with higher and lower minimum wages shrinks considerably.

From this perspective, Luxembourg no longer tops the list. Those on minimum pay earn 57 per cent of the median wage. France tops the list here, at 66 per cent. Bulgaria - with the lowest minimum wage - has a smaller gap than Luxembourg, here those in minimum wage roles earn 59 per cent of the country's median wage.

The difference in prices and the cost of living across different member states is another consideration. The comparison can be made by looking at the purchasing power standards (PPS), the measure of how much you can buy for a given quantity of money.

Taking PPS into account reduces the disparity between countries. At the two extremes, Luxembourg's minimum wage is 6.6 times higher than that in Bulgaria but looked at through PPS the difference decreases to 2.7 times.

Source: RTL

New data from Eurostat reveals that Luxembourg's minimum wage is the highest in the European Union. RTL examines how it measures up in real terms.

At just under €2,202, Luxembourg's minimum wage is substantially higher than Ireland’s - the country with the second-highest minimum wage in the EU - at €1,724. It is 6.6 times higher than that of Bulgaria the country with the lowest minimum wage in the EU, €332. 

It is more than twice as high as the US minimum, which at present stands at around €1,024 while as President Biden tries to push through an increase to $15 (around €12.50) per hour.

Luxembourg is the only country in the EU with a minimum wage exceeding €2,000. Five other EU countries - Ireland, the Netherlands, Belgium, Germany and France - pay minimum wages of more than €1,500.

The difference begins to shrink, however, when the cost of living is taken into account and when there is a comparison of median earnings in each country.

Considering minimum wages in relative terms; by looking at how each country's minimum wage measures up against the median gross income earned by full-time and full-time equivalent employees, the difference between the countries with higher and lower minimum wages shrinks considerably.

From this perspective, Luxembourg no longer tops the list. Those on minimum pay earn 57 per cent of the median wage. France tops the list here, at 66 per cent. Bulgaria - with the lowest minimum wage - has a smaller gap than Luxembourg, here those in minimum wage roles earn 59 per cent of the country's median wage.

The difference in prices and the cost of living across different member states is another consideration. The comparison can be made by looking at the purchasing power standards (PPS), the measure of how much you can buy for a given quantity of money.

Taking PPS into account reduces the disparity between countries. At the two extremes, Luxembourg's minimum wage is 6.6 times higher than that in Bulgaria but looked at through PPS the difference decreases to 2.7 times.

Source: RTL

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