"Figure": Living Wage in Riga is €1630 - Lower in Tallinn, Higher in Vilnius
10/10/2024
The living wage, or the minimum income level necessary for an individual or family to cover basic needs and maintain a decent standard of living in a specific geographic area, is €1630 gross in Riga for 2024, while in other regions of Latvia, it is €1384 gross, according to data from the compensation survey and management consultancy firm “Figure Baltic Advisory.” Compared to last year, the living wage in Riga has increased, but in the regions, it has changed minimally. In 2023, the living wage in Riga was €1501 gross, and in the regions, it was €1397 gross.
The company calculates this threshold based on a specific range of services and products. For a family with two adults and two children, the living wage in Riga is €2119 gross, and in the regions, it is €1724 gross, assuming both parents earn equal salaries. The average salary in Riga is currently €2286 gross, while in the regions, it is €1590 gross.
“Data on the living wage is crucial for employers to attract and motivate employees. Studies have shown that socially responsible pay is one of the key factors in motivating employees and building trust between workers and employers. Already, there are several organizations in the Baltics that have defined the living wage as the minimum wage they pay, even for the simplest jobs in their organization," says Anta Praņēviča, board member and lead consultant at "Figure Baltic Advisory."
Comparing the situation in neighbouring countries, it was found that Vilnius has the highest living wage – €2173 gross, while Tallinn (Harju County) has the lowest – €1621 gross. Compared to 2023, Vilnius has seen a larger increase, with the threshold at €1995 gross last year, while the increase in Tallinn has been relatively small (from €1614 gross in 2023). When analysing the living wage in the regions of the three Baltic countries, it is evident that the regions of Estonia have the lowest living wage – €1270 gross, while the regions of Lithuania have the highest (€1899 gross). It is important to note that taxes vary significantly across the three Baltic states, and the study compares gross wages.
"The difference between the living wage in Riga and the regions mainly arises from housing costs, which are higher in the capital than in the regions. However, when analysing the salary policies of employers whose employees work in both the capital and the regions, it can be concluded that only a few set different salaries for the same positions based on the place of residence," adds A. Praņēviča.