The Serbian Ministry of Finance announced that public sector salaries will be increased in the near future, alongside a planned 9.4% rise in the minimum wage starting October 2025. This increase is expected to contribute to a further rise in the average salary across the economy due to the “chain effect,” where wages above the minimum also rise to maintain pay differentials.
The Ministry projects the average net salary to grow from €932 in April 2025 to around €1,022 by December 2025, reaching €1,174 by the end of 2026, aiming to fulfill the government’s pledge of a €1,400 average salary and €650 minimum wage by the end of 2027.
However, wage negotiations for the public sector are separate from those for the minimum wage, governed by budget laws and fiscal rules to ensure public finance stability. The Ministry emphasized that salary increases in the public sector will be decided through a different process and communicated in due time.
Economists note that the impact of the minimum wage hike on the average salary will be limited since only about 8,000 to 9,000 public sector workers earn the minimum wage, a small portion compared to roughly 540,000 public employees.
Experts warn that rising wages in low-paid sectors, driven by labor market pressures and the need to retain workers, will also push average salaries higher. Additionally, some wage increases may result from formalizing previously underreported payments, affecting official statistics.
Trade unions support regular minimum wage increases to retain skilled workers and prevent brain drain, advocating that public sector wages should rise in line with minimum wage growth to avoid wage compression and maintain fair pay across sectors.
