Countries with the Strongest Wage Growth - Forecasts for Europe in 2026
Real wages in the eurozone have largely recovered after falling sharply during the period of high inflation in 2022, according to the European Central Bank (ECB). Nominal wages have risen faster than prices. As a result, real wages in the eurozone in early 2025 are close to the levels observed before the inflation spike in late 2021.
According to the Employment Conditions Overseas (ECA) Wage Trends 2025–26 report, real wages increased across Europe in 2025 in almost all countries surveyed, a trend that is expected to continue in 2026.
By the end of 2025, the report notes, real wages will increase in 23 of the 25 European countries surveyed, while Romania (–0.9%) and Ukraine (–3.2%) will see declines. Among others, the increase ranges from 0.2% in Austria to 5.1% in Turkey.
In Turkey, a nominal wage increase of 40% combined with the IMF’s inflation forecast of 34.9% results in a real increase of 5.1%. This makes Turkey the country with the strongest real wage growth, followed by Bulgaria and Hungary.
Among Europe's "Big Four" economies, France ranks highest, followed by Germany, Italy, and then the United Kingdom.
Turkey is also expected to record the highest real wage growth in 2026, at 8.1%, surpassing the peak in 2025.
The ECA forecasts an average real wage increase of 1.4% across 25 countries in 2025 and 1.7% in 2026. Romania (-0.7%) is expected to see another decline, while all other countries will register positive growth.
Hungary, Poland, the Czech Republic and Bulgaria will be among the groups with the highest growth.
"Eastern European economies are generally projected to outperform their Western European counterparts again, benefiting from faster economic growth and higher productivity," the report said.
The UK will continue to record the lowest real wage growth among major European economies at 1.1%, but this marks a clear improvement compared to 2025.
The United Kingdom and Italy lag slightly behind France and Germany in terms of projected real wage growth for 2026, but the main difference is in projected inflation.
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