Average monthly wages in Slovakia are expected to grow 5% to 7% in 2020, down from the expected growth of 6% to 8% this year, according to survey data from Grafton Recruitment.

During the second quarter of the year, the average monthly salary increased to €1,110, a growth of 9.7%, year-on-year. The production sector, administration, the healthcare sector, recreation and public administration saw the biggest growth during the quarter.

However, the trend will not continue as wage growth is set to slow in the third and fourth quarters of 2019.

Miroslav Garaj, regional managing director of Grafton Slovakia, commented, “Our labour market is exhausted, economic recession is being talked about, there's no reason for any big salary hikes.”

Garaj also attributed the expected slowdown in wages to a decline in Slovakia's exports to Germany, and the overall global economic uncertainty.

“Saturation in the European automotive industry and an expected drop in production in the sector are likely to influence the labour market, accompanied by ongoing automation and digitisation, resulting in lower demand for workers, thus easing the pressure on salary growth,” Grafton stated.

Garaj also pointed to a few bright spots in wages citing an ongoing high demand for production workers and growth in foreign labour. Salaries in trade and retail are expected to grow relatively sharply.