Private sector wages in Greece have been rising at an annual pace of around 5%, placing the target of reaching 1,500 euros in average gross earnings by 2027 within sight, although persistent structural weaknesses such as low labour productivity cast uncertainty over the landscape for 2026. Recent efforts by the government and social partners to establish a new social agreement aim to boost collective bargaining and broaden the use of collective labour contracts.
Coverage by collective agreements remains significantly below 30%, making the return to pre crisis wage levels a complex undertaking, yet the new framework is intended to reinforce negotiations and support future pay increases. Forecasts for 2026 point toward continued wage growth of roughly 5% annually in the private sector, following a trajectory that could bring the average gross salary to between 1,461 and 1,470 euros by April 2026, provided macroeconomic conditions remain stable.
Current figures show a clear gap between full time and overall average earnings, as data from EFKA for May 2025 indicates that the average full time wage stood at 1,369.07 euros, while the combined average for full time and part time employment reached only 1,192.5 euros. These disparities underline the challenge of achieving broad based wage improvements.
The government’s plan to lift the national average wage to 1,500 euros by 2027 rests on three main pillars: successive minimum wage increases, the restoration of seniority allowances and a stronger system of collective bargaining. Policymakers expect that a forthcoming 5 year action plan will help facilitate new sectoral and enterprise level agreements, building on a labour market framework that currently remains thin, with just 25 sectoral and around 170 enterprise agreements signed in the first half of 2025 and many expiring in 2026.
The Bank of Greece maintains a more cautious stance, highlighting that wage increases are not being matched by improvements in labour productivity, which threatens the competitiveness of the economy. Productivity levels continue to lag behind the EU average, raising concerns that pay rises could feed into higher production costs and reinforce inflationary pressures.
Central bank recommendations focus on moderate wage growth aligned with productivity, accompanied by investment in skills, technology and policies that boost labour force participation among women, young people, retirees and highly skilled expatriates returning to Greece. Tight conditions in the labour market have made it harder for firms to recruit staff, pushing some to offer higher salaries to attract or retain workers.
Rising unit labour costs outpacing productivity gains are increasingly viewed as a potential drag on competitiveness, underscoring the need for a balanced approach to wage setting that maintains economic stability.
