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Serbia, Economy outlook in first quarter of 2023.

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In the first quarter of this year, an average year-on-year increase in consumer prices of 16.0 percent was recorded, and the inflation in this period was mostly influenced by the increase in the prices of milk, cheese and eggs, meat, solid fuels, i.e. firewood, bread and cereals, vegetables and electricity. For the household.

The average salary without taxes and contributions in Serbia for the first quarter is 82,203 dinars, nominally higher by 15.5 percent compared to last year, the Republic Institute of Statistics (RZS) announced today.

RZS stated that the biggest influence on the growth of total consumer prices was the annual increase in the prices of milk, cheese and eggs, primarily due to the increase in the prices of yogurt and sour milk, fresh cheese and milk, which participated in the overall structure of the growth rate of consumer prices with 13 .8 percent.

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The Increase in the price of meat of 19.7 percent was mainly contributed by the increase in the price of dried smoked and salted meat, primarily bacon and sausage, boneless pork, beef and beef and chicken fillet, whose total participation in the structure of the annual rate of increase in the price of meat in the first quarter was 47.2 percent.

The biggest contribution to the annual increase in the prices of bread and cereals, of 23.4 percent, was made by the increase in the price of white bread, salty snacks, burek, savory pies, cakes, tarts and sweet pies, which participated in the structure of the overall growth rate of bread and cereal prices with 62, 8 percent.

In the first quarter, the price of vegetables was mostly determined by the price of potatoes, tomatoes and peppers, and as an interesting fact, RZS states that the only deflationary impact was the drop in cabbage prices.

Solid fuels rose in price by 46.7 percent in the first quarter, which was mostly influenced by the increase in the price of solid fuels, primarily firewood, which accounted for 74.6 percent of the total annual increase in the rate of solid fuels.

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The year-on-year price increase in the housing, water, electricity, gas and other fuels statistical group amounted to 23.4 percent, which was mostly contributed by the increase in the price of household electricity from January 2023, which accounted for 29.0 percent of the total growth rate in the structure of this group in first quarter, while in the interannual growth rate of total consumer prices it participated with about 5.6 percent.

The average salary without taxes and contributions calculated in Serbia for the first quarter of 2023 was 83,208 dinars. Compared to the same period of the previous year, it is nominally higher by 15.5 percent, while in real terms it is lower by 0.4 percent, according to the Republic Institute of Statistics.

Compared to the previous quarter, i.e. in the fourth quarter of 2022, the average salary is nominally higher by 4.9 percent, while in real terms it is higher by 1.5 percent, the results of the analysis of the first quarter of 2023 showed.

Since the beginning of the year, nominal wages have moved in line with the trends in the real economy and the budget, at the same time adjusting to market indicators, i.e. labor supply and demand. The average salary without taxes and contributions shows a growing trend and in March 2023, with the amount of 85,485 dinars, it reaches an annual growth of 14.5% in nominal terms, while in real terms it is lower by 1.5%.

The Increase in wages was also influenced by the decision to increase the minimum wage from 201.2 dinars per working hour in 2022 to 230 dinars in 2023, they remind in the report.

Also, the average salary without taxes and contributions, expressed in euros, as an indicator of the standard of living and the international competitiveness of the Serbian economy, is growing, reaching a value of 729 euros in March 2023, or an annual growth of 15%, which is close to nominal salary growth due to the relative the stability of the exchange rate of the dinar against the euro, the Institute says.

According to the RZS, the ratio of wage movements in the public sector and outside it has been variable for a long time, since on several occasions the successive growth of wages in the public sector led to their increase outside the public sector as well, which resulted in the growth of total wages.

The wage management policy in the public sector thus proved to be the driving force behind internal demand and a regulator of fluctuations in the labor market. From the beginning of 2023, earnings in the public sector are at a higher level than earnings outside it, the analysis shows.

By comparing earnings without taxes and contributions by sector, it is noted that the highest real growth in the first quarter of 2023, compared to the same period in 2022, was achieved in the Wholesale and retail trade and motor vehicle repair sectors (1.3%), industry (0.8%) and Professional, scientific, innovative and technical activities (0.7%).

The highest earnings without taxes and contributions in the first quarter of 2023 were calculated in the following areas: Computer programming and consulting activities (255,439 dinars), Air traffic (178,606 dinars), Scientific research and development (174,434) and Exploitation of crude oil and natural gas ( 167,123 dinars).

In all other areas, earnings ranged from 46,393 dinars (Activity of preparing and serving food and beverages) to 150,978 dinars (Management activities; consulting related to management).

Observed by region, the highest average salary without taxes and contributions in the first quarter of 2023 was calculated in the Belgrade region (105,304 dinars). In the Region of Vojvodina, the salary was 79,113 dinars, in the Region of Southern and Eastern Serbia 71,461 dinars, and in the Region of Šumadija and Western Serbia 69,240 dinars.

The ratio of the average consumer basket and earnings without taxes and contributions in the first quarter of 2023 indicates a slight increase in purchasing power compared to the previous quarter.

To cover the average consumer basket in the first quarter of 2023, it was necessary to set aside 1.16 of average earnings (in the fourth quarter of 2022 – 1.17), while to cover the minimum consumer basket, 0.60 of average earnings was enough (in the fourth quarter 2022 – 0.61).

Compared to the same quarter of the previous year, the ratio of the average consumer basket to earnings without taxes and contributions of 1.16 indicates a decline in purchasing power (in the first quarter of 2022 – 1.13), with a minimum consumer basket of 0.60 average earnings it slightly exceeds the level from the same quarter of the previous year (0.59).

Observed by cities, in the first quarter of 2023, the purchasing power (ratio of average consumer basket and average salary) above the average of the Republic (1.17) had Belgrade (0.95), Novi Sad (1.09), Nis (1 ,14) and Kragujevac (1.16), while in the other cities, which are statistically monitored, the average wages covered the minimum, but not the average consumption basket of households, the data are from the RZS analysis.

 

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