Food prices have skyrocketed across Europe in the last five years, but here’s the kicker: minimum wages have surged even more in most of the 26 countries examined by Euronews Business. Yup, you heard that right! Except for Malta, where folks earning the minimum wage can actually buy about 6% less food today than they could five years back, even though their wages have gone up. It’s a head-scratcher, especially for minimum-wage workers in Spain and France who are also feeling the pinch.
According to Eurostat, food and non-alcoholic beverage prices have shot up by 34% throughout the EU between August 2021 and August 2026. Hungary takes the cake with a staggering 57% rise, followed closely by Bulgaria at 54% and Romania at 53%. On the flip side, Cyprus managed the smallest increase at just 21%. When we widen the lens to 35 European countries, Switzerland stands out with the lowest hike of only 5%. But wait, Turkey is a whole different ballgame; food prices there soared by an eye-watering 752% in the same timeframe. That’s right—seven hundred fifty-two percent!
What’s fueling this madness? Turkey’s inflation has been sky-high, partly due to a drastic fall in the lira. This has jacked up the cost of imported goods and materials. Remember, this decline in the lira was exacerbated by interest rate cuts starting in 2021, even as inflation was climbing. The decision to raise rates sharply in 2023 didn’t put the brakes on rising prices either.
Now, let’s not forget that food prices were already on the rise before Russia kicked off its invasion of Ukraine in February 2022. That war only added fuel to the fire by hiking energy, fertilizer, and transport costs while throwing agricultural markets into disarray. All these factors have trickled down to consumers at supermarkets.
Among the EU’s big players, food prices jumped by 25% in France, 30% in Italy, 34% in Germany, and 35% in Spain from August 2021 to August 2026. Meanwhile, minimum wages didn’t sit idly by either. Hungary saw the largest jump in the EU at 93%, while Germany’s minimum wage rose by 46%, Spain by 29%, and France by 20%. These increases are all measured in local currencies, but Turkey’s staggering 823% increase in minimum wage over five years is hard to ignore.
But here’s the rub: higher wages don’t always equate to more food on the table. The real comparison looks at how much food a monthly gross minimum wage could buy in August 2021 versus August 2026. It doesn’t factor in what workers have left after paying taxes, rent, and other bills. Just subtracting the food price increase from the minimum wage increase can be a bit misleading, especially in a high-inflation environment like Turkey’s.
When you break it down, in three of the 26 countries, minimum-wage earners actually lost purchasing power against food prices. Malta again faced the biggest drop at 6%. Picture this: a minimum-wage worker who could buy 100 baskets of food back in August 2021 could only snag 94 by August 2026. Spain and France followed with declines of 5% and 4%, respectively.
On the brighter side, Serbia and Montenegro showed the largest gains in purchasing power, with a whopping 37% increase. An individual who could buy 100 baskets back in August 2021 could now afford 137. Other countries like Croatia, Albania, Romania, Hungary, Bulgaria, and Lithuania also saw increases of over 20%.
Food purchasing power climbed by 10% in Ireland, 9% in Germany, 7% in Greece, 6% in Belgium and the Netherlands, and 3% in Portugal. A chart indexed at 100 back in August 2021 illustrates how the amount of food a minimum-wage earner can buy has shifted over these five years.
In Turkey, with a minimum wage that skyrocketed by 823% and food prices up by 752%, you’d think things would balance out, right? Well, the increase in food purchasing power was just 8%. Both wages and food prices rose sharply in lira, with wages edging out slightly. The same chart illustrates that minimum-wage earners in Turkey lost ground at times in 2021 and 2022 when food prices outpaced their wages.
However, since January 2024, the minimum wage has finally outstripped food prices, allowing workers to buy more than they could back at the starting point. So, what’s next for these workers? Will they finally catch a break, or is there more turbulence ahead?
Kaynak: Orijinal Haber