The recession has been a tough time for workers everywhere. Unemployment has skyrocketed in numerous advanced economies, and many more workers have faced stagnating or falling income or have had to take lower-paying jobs. Yet not all countries have been hit by the recession in the same way, and workers in stronger economies have fared better off than less-fortunate citizens of hard-hit countries such as Spain and Greece.
So who’s working for the most pay in today’s global recovery? Here are the Organization for Economic Cooperation and Development’s top five countries by annual average gross wages in 2011, adjusted for purchasing power parity. The names here may not be what you’d expect.
No. 5: The Netherlands, $47,056
Dutch workers are doing a lot better than their peers, but this country’s hardly a growth story. The average Dutch worker has lost more than $500 per year since the country’s peak average annual wages in 2009. Before the recession hit, Dutch workers weren’t doing too bad: Average wages increased 10.5% between 2000 and 2009. That’s better growth than many of its OECD peers managed. Unfortunately, that wasn’t anywhere near enough to keep up with the country’s inflation until 2008, so while Dutch worker paychecks have increased since the start of the century, the power of that money has fallen.
Help’s not coming soon for the Netherlands’ workers. Europe’s fifth-largest economy is back in recession territory like many of its fellow eurozone countries, and unemployment climbed to 8.2% in April. The country and its workers are still better off than most Europeans — the country’s jobless rate is nowhere near Spain’s 27.2% unemployment and still below the eurozone’s average — but a 16 billion euro austerity measure approved last year won’t help the average Dutch citizen in the near term. It wouldn’t be surprising to see wages continue to fall as the Netherlands and Europe at large continue to fight off economic contraction.
No. 4: Switzerland, $50,242
Here’s a European country that’s outperformed its European peers by a wide margin throughout the recession. Switzerland’s per capita GDP hit a slight bump by contracting in 2009, but it recovered all its losses and made up even more ground in the recent past, emerging from the recession stronger than ever. The country’s average wages haven’t fared quite so well, however, falling year over year between 2009 and 2011 and growing just under 10% between 2000 and 2009.
While Switzerland survived the recession with a remarkable amount of resilience, even this nation couldn’t escape Europe’s downturn forever. The country’s strong currency has hampered exports, and while the International Monetary Fund expects sluggish Swiss economic growth overall in 2013, that may not translate down to the average worker’s wages. However, with Swiss unemployment still very low at just over 3% in March, the country’s citizens at least have jobs to collect wages from — something many other Europeans can’t say. While the nation may slow or even contract in the coming quarters, Switzerland’s still far better off than most of its European fellows.
No. 3: Ireland, $50,764
It’s difficult to believe Ireland’s wages rank as the third-highest in the OECD. The island nation is a poster child for the damages of the recession, and unemployment has hung in double-digit territory since 2009. The IMF expects unemployment of 14.3% this year, one of the highest rates in the eurozone and a number that will do little to help the average Irish citizen looking for a job. For those who have jobs, however, average annual wages hit a new high in 2011 and gained more than 23% between 2000 and 2011.
Despite Ireland’s withering jobless rates, this is one of the few European countries with a bright outlook in the near future — something that should help workers continue to see wages increase. Older Irish citizens haven’t felt much of a blow from the recession, gaining a 41% increase in income between the 2004-2005 fiscal year and 2009-2010. In the long term, however, Ireland’s wage increase among its older citizens could be its bane: Younger Irish have seen incomes nosedive by 14% during that time frame, and spending among the young plummeted during the recession. If younger Irish don’t see an economic turnaround, the country’s wage growth won’t mean anything in the long term.
No. 2: Luxembourg, $52,847
Little Luxembourg has managed to avoid falling back into recession since the depths of the 2008 crisis, but the country’s average wages, despite being the highest in Europe among OECD nations, have seen little growth since the start of the century. Annual wages for the average Luxembourg worker have grown just 7.5% since 2000 and fell more than 2% between 2010 and 2011 alone.
Fortunately, unemployment’s still low in Luxembourg, coming in at just 6.6% in March — although that number’s been steadily climbing recently. While this country’s workers are in a much better position than most of their European peers — and as far as gross wages, they’re unrivaled — even Luxembourg, located in Europe’s industrial heart, may not be immune to the grip of recession much longer.