OEB criticizes the recent increase in the national minimum wage as disproportionate and economically unfounded

The Federation of Employers and Industrialists (OEB) has expressed concerns regarding the recent decision by the Council of Ministers to increase the national minimum wage by 8.8%.

This increase raises the minimum wage to 58% of the national median wage, compared to 48% in the Netherlands, 51% in Germany, and 54% in Luxembourg. The federation considers this percentage disproportionate and economically unfounded, suggesting it overestimates the strength of the Cypriot economy.

The increase is expected to have two main effects:

• Businesses unable to pass on higher costs may face viability issues.
• Those able to do so will likely transfer costs to consumers, leading to inflationary pressures and reducing workers’ real incomes.

The federation will monitor the macroeconomic impact of this wage increase closely.