Virtuous cycle

Bartlomiej Owczarek weblog

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Salaries quickly increasing, but for some quicker than for others

An article in Rzeczpospolita by Anna Cieślak. For some time I thought the income distribution would be getting more equal – it was an intuition based on the fact that many lower-paid jobs became understaffed, because people went to work abroad.

Construction workers, waiters, and others were in short supply and their salaries were raising fast. On the other hand, specialists are earning quite a lot already compared to the West, so there seems to be a smaller salary gap.

But the article suggests that the polar brackets of income are getting larger, meaning more people are earning both much less and much more than the average.

Share of people who earn 50% or less of an average salary increase to 19.9% in 2006, from 17.4% in 2002 and 13.4% in 1999.

On the other hand, share of people who earn 250% or more of an average salary increased to 3.8% in 2006 from 3.4% in 2002 and 3% in 1999.

However, the data is from 2006 and doesn’t reflect the latest revolution on the labor market due to emigration. The experts who are quoted say that the trend is actually against the low earners – these are specialists and middle-earners that are able to demand higher wages.

Also there is a note, though not elaborated, that taking into account non-labor income, the increase of discrepancies is now slower than before.