Swiss purchasing power plummets as inflation takes hold
New data from the Federal Statistical Office has revealed that while salaries in Switzerland rose in 2022, they failed to keep up with inflation, resulting in a loss of purchasing power. While inflation rates in the alpine nation are lower than in neighbouring countries, so too are wage increases.
Average salary in Switzerland rose in 2022
According to the new report, the average worker in Switzerland received a pay rise of 0,9 percent in 2022. The biggest wage increases were recorded in the chemical and pharmaceutical industries, which saw pay packets swell by 4 percent on average last year.
The Swiss government also found that this increase varied based on a worker's sex. Last year, men took home 1,1 percent more wage than in 2021, while women only saw average wage rises of 0,8 percent.
Take-home pay in Switzerland suffers thanks to high inflation
Despite the increase overall, many smaller industries have actually seen wages fall - even before inflation is taken into account. Staff wages at rubber and plastic manufacturers fell by 2,2 percent on average last year, while clock makers saw salaries decline by 0,6 percent.
At the same time, the alpine nation experienced a cost-of-living increase of 2,8 percent over last year. This means that the average worker saw their pay packet decrease by 1,9 percent in real terms last year.
This finding adds to a previous report by UBS in November, which found that average purchasing power in Switzerland has fallen to levels unseen since World War Two. At the same time, a new study by 20 Minuten revealed that around 40 percent of Swiss families are worried about their finances.
Inflation to remain an issue in Switzerland in 2023
Swissinfo predicted that inflation will continue to be a problem in Switzerland in 2023. The most recent inflation figures from the government showed a year-on-year rise of 3,4 percent in February, with authorities predicting that new interest rate rises are inevitable.
This year, UBS has predicted that salaries will rise by 2,2 percent, while the Swiss National Bank forecasts 2,6 percent inflation. In 2024, both wage growth and inflation are expected to ease.
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