Despite the persisting difference in mentality, the flow of tourists from Russia and compatriots wishing to stay in Latvia for permanent residence did not dry up even in the years of cooling relations between the countries. If the purpose of a visitor is not limited to a walk in the historical center of Riga or attending a concert in "Dzintari", then first of all he will be interested in the average salary in Latvia and the likelihood of successful employment.
Employment prospects in Latvia
If we focus on the structure of GDP formation, agriculture, woodworking, logistics, trade, real estate, tourism and the public sector are significant for the country's economy.
According to the Central Statistical Bureau of Latvia (CSB), the GDP for 2021 increased by 4.8% compared to 2021, and the employment of the population aged 15 to 74 reached 64.5%.
And if the overall indicator of involvement of the entire population increased by 1.6%, then in the youth segment the increase is not so noticeable - only 0.1%. This means that in 2021, only 33.1% of people aged 15 to 24 had the opportunity to work.
At the same time, the unemployment rate in Latvia (the number of people unsuccessfully looking for a job) is not the highest in Europe: 6.9% - general and 10.8% - among young people. In such conditions, migrants from other countries who did not come at the invitation of the employer will be welcome only in those areas where salaries are considered too low for the indigenous population.
Such professions include drivers, salespeople, support and maintenance personnel. In addition, there is one more condition on the way of those who are interested in how to find a job in Latvia: according to the legislation, an employer can accept a foreigner into the team only if no Latvian responds to it within 30 days of the vacancy announcement.
Salary level in Latvia
Over the past couple of years, there has been a tendency towards narrowing the gap between the indicators of the average and minimum wages in Latvia. If at the beginning of 2021 the national average was more than twice the minimum, then by the end of 2021 the difference had decreased to 40%. It should be noted that both values gradually grow.
Minimum income
Latvian legislation establishes that with a normal working day, an employer has no right to pay an employee less than the minimum wage in Latvia (Article 61 of the Labor Law adopted by the Seimas in 2001). From 2021, the size of the minimum wage is approved by the Cabinet of Ministers.
In August 2021, at its meeting, it was decided to raise the lower wage bar to 430 euros per month from January 1, 2021. The document stipulates that the established restriction will apply to all employers and will remain in effect for three subsequent annual periods.
Not least because of such legislative initiatives in the country there is a steady increase in minimum indicators and a more unstable dynamics of independent averaged values. Thus, according to statistics, about a third (30.5%) of Latvian specialists receive no more than 450 euros a month “clean”. At the same time, the minimum wage in Latvia remains at 16.9% of workers.
The lowest incomes are for workers in the field of catering, real estate transactions, education, personal services, assistance with household chores and repair work.
Low salaries and those employed in the tourism industry and the arts (recreation, entertainment, accommodation of visitors). The average gross salary for employed persons does not exceed 900 euros (before taxes).
If we consider the income of the population by region, then statistics claims that employees are paid the least in Latgale (708 euros per month, which does not exceed 70% of the national level). Although the dynamics of salary growth in this area is quite high - 9.2% versus 7.1% increase in Riga.
Average salaries
The Bureau of Statistics claims that the accrued average salary in Latvia, according to data for the third quarter of 2021, was 1006 euros (approximately 744 euros "net"), which is 8% higher than in 2021. There is a noticeable division by sectors of the economy.
| Sector | Average salary, euros | % growth |
|---|---|---|
| Total | 1006 | 8 |
| Commercial private enterprises | 992 | 7.7 |
| Government sector | 1036 | 8.5 |
It should be borne in mind that not only salaries but also prices are growing every year. Therefore, after deducting the inflation rate of 2.9%, the growth of net income in various regions did not exceed 7% in 2021.
If we compare by industry, then the average accrued wages rose most noticeably in health care, mining, services and public catering.
| Industry | Average salary by industry before taxes, euros | % growth |
|---|---|---|
| Financial activities and insurance | 1932 | 0.4 |
| IT-sphere and communication | 1584 | 8.4 |
| Energy industry | 1272 | 5.2 |
| Public administration and protection | 1260 | 6.9 |
| Extractive industry | 1186 | 10.6 |
| Health care | 980 | 15.9 |
| Construction | 978 | 7 |
| Transportation and transit of goods | 962 | 6.3 |
| Real estate operations | 843 | 6 |
| Education | 822 | 6.9 |
| Accommodation of tourists and catering | 720 | 11.6 |
Maximum income of employees
Today the average salary in Latvia ranges from 700 to 1400 euros and, according to statistics, only 25.7% of the working population receive it. The number of specialists who can boast of incomes exceeding 1,400 euros per month is much less. Such workers are only 4.1% of those officially employed.
If we talk about where, geographically or in what area, the maximum earnings are expected for professionals, then we can distinguish several patterns:
- high salaries in Latvia by profession and by industry remain in financial activities and insurance, telecommunications, electricity supply;
- regional maximum - the highest earnings in Riga and the Pririzha region;
- by specialties and qualifications - the highest salaries for managers (up to 7200 euros), leading specialists, programmers, engineers and financial analysts (within 1500-2000 euros).
In addition, decent salary positions will only be available to those who:
- speaks Latvian and preferably English;
- has a higher education received in the EU, or a diploma from a university recognized in Europe;
- received a residence permit with an open work visa or an EU Blue Card, confirming a residence permit or work permit within the EU.
On top of that, the country has a legislatively fixed priority of employment for Latvian citizens. This is reflected in the restrictive rules for the recruitment of foreigners.
The employer is obliged to report an open vacancy to the State Employment Agency (Nodarbinātības valsts aģentūra, NVA) in order to exclude the possibility that a local specialist will be unemployed. Further, a monthly check is carried out in relation to the employer for the appearance of a Latvian candidate for this post.
Only a small group of specialists does not fall under this rule:
- self-employed persons (entrepreneurs and founders of their own firms);
- art workers, coaches and athletes, specialists involved in organizing competitions and cultural events;
- specialists in international agreements;
- foreign teachers with special accreditation.
Remuneration for labor depending on the specialty
The average statistical indicators do not reflect the distribution of income of the population depending on the profession and position held. The highest salaries are offered to executives and narrowly focused specialists in the financial, information and IT sphere.
In comparison with them, the salary of a teacher in Latvia may be several times lower and approach the legislatively established minimum (by the way, for educators it was raised to 700 euros).
The ranking of net income in the main areas looks like this:
- first manager - 3,300 euros / month;
- programmer - 1,370 euros / month;
- sales manager - € 1,233 / month;
- auditor - 1,188 euros / month;
- engineer - 1,079 euros / month;
- lawyer - 1,048 euros / month;
- marketer - 959 euros / month;
- electrician, welder - 750-790 euros / month;
- doctor - 749 euros / month;
- teacher - 731 euros / month;
- policeman - 727 euros / month;
- taxi driver, driver - 708 euros / month;
- nurse / nurse - 516 euros / month;
- part-time worker - 477 euros / month.
To determine the objective level of the expected income in a narrower industry, you can use the service for comparing current salaries Algas.lv.
Since the country has a restriction on the minimum wage with a normal workload of an employee for a month, the estimated hourly wage also cannot be lower than this indicator.
The derived metric is used at partial load. In this case, the salary of a part-time doctor may be less than € 430 per month. However, based on one hour of employment, it cannot be lower than 2.33-2.69 euros / hour.
The specific size must be determined according to the rules of Articles 131 and 133 of the Latvian Labor Law and the norms of hours worked.
Difference by region
There is also regional division. The highest salaries are predictably fixed in Riga, but if you take it in percentage terms, in the capital, there is a slowdown in income growth. In 2021, it barely exceeded 7%.
| Statistical region | Name in Latvian | Accrued wages in Latvia, EUR / month | Growth rates in 2018,% |
|---|---|---|---|
| Total by country | LATVIA | 1006 | 8 |
| Riga | Rīgas statistiskais reģions | 1124 | 7.1 |
| Pririzhsky | Pierīgas statistiskais reģions | 957 | 9.7 |
| Kurzeme | Kurzemes statistiskais reģions | 876 | 11 |
| Vidzeme | Vidzemes statistiskais reģions | 818 | 8.9 |
| Zemgale | Zemgales statistiskais reģions | 861 | 8 |
| Latgale | Latgales statistiskais regions | 708 | 9.2 |
If we cross-compare the regions in terms of specialties of different qualifications, it turns out that the salary in Riga and Latgale for an employee in the same position is strikingly different.
Average net salary, EUR / month:
| Position | Riga and Pririzhsky region | Kurzeme | Zemgale | Latgale |
|---|---|---|---|---|
| Chief executive officer | 3302 | 3052 | 3031 | 2796 |
| CFO | 2173 | 1972 | 2022 | 1879 |
| Economist / Commercial Director | 2111 | 1860 | 1839 | 1604 |
| IT specialist, programmer | 2200 | 1900 | 1900 | 1700 |
| Pilot | 2526 | 2523 | 2564 | 2481 |
| Sailor | 2445 | 2442 | 2483 | 2400 |
| Junior chef, baker | 482 | 340 | 350 | 300 |
| Teacher, assistant teacher | 472 | 372 | 378 | 340 |
| Cleaner, maid | 430 | 340 | 330 | 330 |
Employees in Jurmala can boast of salaries comparable to those in Riga: the average income here is 986 euros.
Taxes and net wages
All employment contracts in the section on wages indicate only gross wages (before withholding taxes and contributions). It is clear that at the end of the month the employee receives a much smaller amount of money.
The principle of withholding fees from employee income and accruing liabilities at the expense of the employer has been successfully applied not only in Russia. Salary taxes in Latvia are levied according to a similar scheme:
- income tax is withheld from earnings on a progressive scale: 20% from amounts not exceeding 1,667 euros, and 23% from amounts exceeding this mark, and for annual incomes above 55,000 euros, the rate was raised to 31.4%;
- social insurance contributions: 11% - deduction from accrued income at the expense of an employee, 24.09% - at the expense of the employer.
It must be remembered that income tax is calculated after the deduction of social contributions. In addition, a non-taxable minimum, updated in 2021, is applied to workers with low earnings or with disabled dependents: € 230 per month for employed persons, € 270 for pension recipients.
For simplicity of calculations, you can use the net salary calculator.
Living standards and dynamics of salary growth in Latvia
Relatively low salaries, especially in the field of personal services and public catering, do not prevent Latvians from feeling quite comfortable in the country. This is explained by the fact that the living wage in Latvia is not as high as in the rest of the EU.
Prices for basic groceries and utility bills allow you to live even on the minimum wage.
The lion's share of the costs falls on the maintenance of housing: if you don't have your own apartment, then renting even a one-room studio in Riga (not in the center) will cost 250-270 euros per month, plus utility bills (100-200 euros).
The rest of the cost of living in Latvia is comparable to the costs of Russians at home. A zealous housewife can cut food costs by up to € 20 per week. If you do not save, then the grocery basket will "pull" 50 euros.
Transport in Latvia is somewhat more expensive than Russian: a liter of gasoline is 1-2 euros, travel in public transport is 2 euros per trip. The cost of mobile communication and high-speed Internet will not exceed 30 euros per month.
However, the concept of a living wage is necessary for a foreigner not only for practical reasons and for budget planning. According to the rules of the Cabinet of Ministers of 25.04. 2021 No. 225 (Noteikumi par ārzemniekam nepieciešamo finanšu lidzekļu apmēru un finanšu lidzekļu esības konstatēšanu), in order to extend the residence permit in Latvia, it will be necessary to prove that a citizen of another state is able to support himself and his household.
The amount of personal funds required is calculated based on the average salary for the past year and differs depending on the category of the invited specialist:
- the member of the board of the company must confirm the earnings of 1,852 euros / month;
- employee from among demanded professions - 1,111 euros / month;
- for holders of the EU Blue Card, 1,389 euros / month is enough;
- employees employed under a contract must show a salary of 926 euros / month or more;
- foreign pensioners need to confirm a pension of 576 euros per month;
- for each minor family member - plus 129 euros / month in excess of the required income.
Conclusion
The financial crisis has not spared the Latvian economy, but the country manages to contain negative indicators at the average European levels and show a slight increase in GDP and average wages. Such dynamics, combined with the fact that young Latvians continue to leave to work in other EU countries, creates favorable conditions for the employment of migrants from post-Soviet states. However, most of the migrant workers can find a place only in low-paid professions.
