Automatic indexation in Belgium

Belgium is the only country that has automatic indexation of wages built in, in its economic system. It has been criticized by many, as it would worsen our competitiveness with neighbour countries. But the numbers show, that even the automatic indexation, hasn't been able to keep wages up with inflation.

The reality is that in the last 12 months the average Belgian lost 2.7 % in purchasing power, due to the surging inflation, even though there is an automatic wage indexation in place.

Other countries

The average European lost 4.2 % of his purchasing power last year. The number one position (not in a good way) is for Czech Republic. They lost 4.4 % of their purchasing power. Other countries did better, like Romania, where wages rose more than inflation, wages went up with 7.7 %. So the average Romanian is better off now, than 12 months ago. So, one would question if an automatic indexation is actually necessary. Wages eventually follow inflation, either way.

For the future 12 months a rise of 2.0 % of purchasing power is projected in the Eurozone. But it will be different in every country. It shows that the Eurozone, is a union, but still is very divided when it comes to economy and politics.

Now, it's time to watch Belgium against France in the 1/8 final of Euro 2024, let's hope we beat them this time!

Sincerely,

Pele23

Posted Using InLeo Alpha