Wages in the Western Balkans: The minimum between wishes and reality

Eurostat data are relentless: the Western Balkans sits at the back of Europe in terms of minimum wages. For economic analysts across the region, from Tirana to Belgrade, the key problem is that these wages are not sufficient even for a minimum consumer basket. Some therefore urge politicians to “take off the rose-tinted glasses” and see how workers actually live.

Written by: Djordje Barovic

The Government of Serbia is raising the minimum wage to €500 as of October 1.

Today, Serbian President Aleksandar Vucic announced an extraordinary increase in the minimum wage as of January 1, 2026, of 10.1%, which, he specified, amounts to a cumulative increase of as much as 37%.

In his address to the public at the “Palata” Serbia today, Vucic announced that as of October 1 salaries in the health care and education sectors will rise by 5% each, and that an extraordinary minimum wage increase of 9.4% will also take effect then.

“On top of that increase, another one of 10.1% comes on January 1. With the 13.7% increase in the minimum wage from January 1 of this year, that is a cumulative increase of as much as 37% compared with December 2024,” Vucic said while presenting new state measures for the benefit of Serbia’s citizens.

He said that as of January 1 the minimum wage would be €551, which will also affect the “coverage” of the consumer basket.

“For the first time in Serbia’s history, we will have minimum coverage of the consumer basket not of 100% but of 111%. This shows how we are progressing and how people can live more decently and more easily,” Vucic said.

According to Eurostat statistics, only workers in Montenegro currently have a higher minimum wage in the region, and this institution calculates wages in gross, not net, terms.

Albania is, by these figures, the “black record holder,” since with a minimum of €408 it is by far in last place in Europe.

From Living to Bare Survival

Tirana-based economic analyst Eduard Gjokutaj told Kosovo Online that Albania has no official statistics on minimum living costs, but that the minimum wage of €412 does not allow for a dignified life—only “survival,” which is why more and more young people are leaving the country.

“In our country there is no official approach to minimum living costs that would include not only basic needs but also housing, health, and education. In the absence of a state methodology or published calculations, various experts, including some independent analysts, estimate that the monthly subsistence minimum for one person is between 24,000 and 26,000 lek (€247–€268), and for a family of four between 90,000 (€929) and 100,000 lek (€1,032). It is obvious that the stated amount is insufficient to cover all necessary expenses and ensure a dignified standard,” Gjokutaj stressed.

He said that, according to official statistics, the minimum wage in Albania this year is 40,000 lek (€412).

“That is not enough to afford a decent life. For a dignified life we must spend not only on food, electricity, and basics, but also have access to other services. If we compare with the minimum wage, the minimum is slightly above this minimum basket, but people who work still feel poor. People spend a lot of time working, but it does not provide an income commensurate with the work they do,” Gjokutaj said.

He explained that without clear changes it is impossible to slow the pace of emigration, especially of the young.

“Young people do not feel secure and do not see the kind of economic prospects that would allow them an income needed for a decent life,” he emphasized.

He noted that the minimum wage in Albania has been increased this year, but that “many workers still live in poverty.”

“They feel economic pressure and cannot have a stable life despite spending long hours at work. This fuels a wave of emigration among those who feel no economic security nor see prospects for a dignified life through work, which in turn reduces consumption, makes the economy fragile, and diminishes chances for a better future,” the analyst specified.

For that reason, he added, Albania, together with Kosovo, is at the back of the Western Balkans in terms of “increasing the population’s well-being.”

“We do not account for public social spending, which should be a policy dedicated not only to a minimum living standard but also to increasing the population’s welfare arising from the country’s economic growth. In that respect, we are among the last in the region. Thus, income growth in our country does not reflect economic growth,” Gjokutaj believes.

He said Serbia, Bosnia and Herzegovina, Montenegro, and North Macedonia “spend more on social issues” in their budgets.

“Albania and Kosovo are increasingly striving to raise these funds, but it remains insufficient. After the new government (in Albania) presented its program, it should not boast only about what has been done in the past, but also in the 2026 budget and in the years ahead. Public spending should, of course, increase, since the moment we are living in requires higher public outlays,” Gjokutaj concluded.

Kosovo at the Back of the Pack

Eurostat data do not include Bosnia and Herzegovina or Kosovo.

On the occasion of September 5—the International Day of the Minimum Wage—the Musine Kokalari Institute for Social Policy in Pristina compiled a report showing that the minimum wage in Kosovo is around €350, and that only one in five workers has a salary sufficient for basic needs.

“The findings show that the minimum wage in Kosovo is not a living wage. Knowing that the minimum wage in Kosovo is €350, that does not cover the cost of living for a single person,” said program director Drenusha Kanolli.

According to that research, a single worker needs €720 for living costs.

Business Alliance president Agim Shahini told Kosovo Online that the minimum wage in Kosovo is the lowest in the region, at €350, and that this amount does not cover the consumer basket. The solution, he believes, is for the government to raise the minimum.

“The minimum wage in Kosovo is the lowest in the entire Balkans—€350. With such a minimum wage, workers cannot live for 15 days. At this moment the minimum should be at least €500,” Shahini said.

He added that this amount does not cover the consumer basket and that the government should decide to increase the minimum wage.

“Rose-Tinted Glasses”

The situation is similar in North Macedonia.

In a Kosovo Online analysis of rising prices and how regional states are tackling them, Skopje-based analyst Abil Baus warned that North Macedonia has seen increases in both wages and inflation.

“Prices have risen by 38% compared with pay rises of up to 7.7% this year. So inflation eats up your higher wages,” Baus argued.

Ivan Pesevski, Vice-President for the private sector at the Federation of Trade Unions of Macedonia, therefore urges politicians deciding on minimum wages to “take off the rose-tinted glasses.”

“Let them, for one day, take off the rose-tinted glasses, turn the cameras toward the citizens, ask them at markets what the prices are, and see that the life of a Macedonian worker, student, and pensioner is reduced to basic items at the green market and the pharmacy—far from expensive clothes and luxury holidays,” Pesevski told Kosovo Online.

He illustrated this with the fact that “seven days in a bungalow on Lake Dojran” is part of the consumer basket.

“If it is a luxury for a worker to work all year and still not be able to afford a vacation, then I don’t know what we’re talking about—what kind of Europe and what workers’ rights. We are first fighting to secure human rights, and then workers’ rights,” Pesevski emphasized.

He added that by all parameters in North Macedonia “workers’ money and purchasing power” are worth the least in the Western Balkans.

“I assume that if, as of January 1, the minimum wage in Serbia is €550, the consumer basket will be under €1,100, which would mean that two minimum wages would cover the minimum basket currently around €700–€750. Believe me, taking all parameters for EU and non-EU countries alike, Macedonia is convincingly last—not only among former EU candidates, but in any comparison with European countries. Every day we face a ‘white plague’ (demographic collapse); every day Macedonia is being emptied of workers, and we will be left a territory with no sense in entering the EU because Macedonian workers have already entered the EU—by moving away,” the union representative said.

He warned that the biggest problem is that minimum wages do not cover the basic consumer basket.

“For 15 years, the Federation of Trade Unions has calculated the minimum trade-union consumer basket, and it currently stands at 65,000 denars (€1,056) without loans or rent. For families who rent or already have a housing loan, that amount is over 80,000 denars—compared with a minimum wage of €400,” Pesevski noted.

Research shows that families living on one or two minimum wages—of which there are, he specified, “thousands,” according to the Public Revenue Office—do not have enough even for basic necessities, let alone a decent life for a family of four.

He recalled that the minimum wage in North Macedonia was introduced in 2012 by the Law on the Payment of Minimum Wages.

“Since then they have, relatively speaking, recorded large increases—perhaps tripled—but compared with prices at the market, fuel, other necessities, and the total of all costs, it turns out that a Macedonian worker cannot get through the month on these incomes,” Pesevski said.

He stressed that the Federation’s fight is to raise the minimum wage in North Macedonia from €400 to €500.

“Even €500 will not be enough to live on, but it will raise the base, which would mean that all wages increase by at least 6,000 denars (€97)—the amount by which living costs have risen in just one year,” the unionist specified.

As an illustration, he said last year the consumer basket was 58,000 denars (€943), and now it is already €1,056.

“All those measures that were supposed to freeze margins or prices did not bear fruit, because during the months when the measures were in force, the basket did not get cheaper by more than 200–300 denars, which—if we consider the entire amount or all workers in Macedonia—turns out to be a statistical error,” Pesevski said.

In North Macedonia there are 167,000 workers, of whom 510,000 receive up to 30,000 denars (€487) per month.

“That means that if both spouses in a family receive up to 60,000–65,000 denars, they are at less than 100 denars (€1.6) per day and are below the poverty line. We appeal that the struggle waged by the Federation of Trade Unions of Macedonia and its affiliated branches against the government and employers not be a struggle to shut down jobs or change the government, but for us to sit at the table and start a social dialogue. We want to see what parameters they have at their disposal, what calculations and what consumer baskets the government and employers are using when they claim it is possible to live in our country on €400 or €500,” Pesevski stressed.

The “tragedy,” he said, is compounded by the fact that decisions on minimum wages and consumer baskets are made by “people with salaries of €3,500, €4,000, or €5,000.”

He was adamant that the minimum wage in North Macedonia cannot possibly cover the consumer basket.

“If we take the figure of 24,000 denars (€390) as the minimum wage and the total consumer basket of 65,000 denars (€1,056), believe me, for a family household of four that is not enough—it barely covers even the average minimum wage, let alone two minimums; and if there is social assistance, one family and one salary,” Pesevski said.

“Catching Up” to the Consumer Basket

Economist Nenad Bumbic of Potrosacki savetnik (Consumer Advisor) told Kosovo Online that the Western Balkans is seeing a trend of rising minimum wages, but they still fail to keep up with minimum consumer baskets.

“In general, for all countries in the region, the trend is a significant rise in minimum wages, but the main problem is that these minimum wages struggle to ‘catch up’ with the consumer basket—even the minimum consumer basket. The primary issue is that consumer baskets do not reflect our real needs,” Bumbic emphasized.

As an illustration, he cited Serbia’s minimum consumer basket, in which a three-member family is allotted 200 grams of luncheon sausage or a larger package of natural juice for an entire month.

“That’s a situation where you could have a guest over once a month, but if they came twice, you wouldn’t have anything to serve them. That minimum consumer basket in no way reflects real, minimal needs—not for a normal life, but for survival,” Bumbic said.

He added that an analysis of consumer baskets across the region shows that “citizens would like politicians to try living that way themselves.”

“It’s hard to imagine anyone realistically surviving on those consumer baskets,” the economist stressed.

He recalled that the Western Balkans still relies on consumer basket models from the former Yugoslavia, with the difference that so-called “unnecessary outlays” have been reduced.

“Realistically, compared to when we were in the SFRY and now, we have seen an objective decline in wealth and in the contents of consumer baskets in all countries of the region,” Bumbic explained.

He noted that, according to Eurostat data for August, Croatia has the highest minimum wage in the region at €970, while within the Western Balkans Montenegro leads with €670 and Serbia with €618.

“But Eurostat’s figures present gross wages, not net, as we are used to,” the economist pointed out.

Bumbic said that raising minimum wages essentially produces “two effects” that benefit only two groups of employees.

“The first group are those whose salaries are calculated using coefficients that include minimum or average wages. The second is linked to state budgets in the region: in this way, pension funds are primarily filled. So, when we raise minimum wages, it does not so much increase income for the actual number of people who truly earn the minimum wage, but rather reduces the amount of money paid under the table by employers, while increasing the taxable portion that fills the budget. This, in turn, creates conditions to increase the pay of budget users and to raise pensions,” Bumbic specified.