Eurozone Companies Predict Lower Wage Increases For Next Year

According to a recent survey by the European Central Bank (ECB), businesses across the Eurozone are anticipating smaller wage increases over the next 12 months. The study reveals that wage growth is expected to moderate to 3.3%, down from the previous estimate of 3.8% three months ago. This adjustment reflects a broader trend of cautious economic expectations amid ongoing inflationary pressures and financial uncertainties.

Key Findings and Economic Implications

The ECB’s survey, which assesses companies’ access to financing and their economic outlook, indicates a slight reduction in expectations for selling price increases, now forecasted at 3% compared to 3.3% previously. ECB officials are closely monitoring these metrics to gauge the trajectory of inflation and its alignment with the 2% target. The anticipated decline in wage growth is seen as a positive indicator, suggesting a potential easing of inflationary pressures, as a 3% wage increase is generally consistent with the desired inflation rate for consumer prices.

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Despite a general slowdown in overall inflation to 2.5%, the services sector remains a concern, with inflation still high at 4.1%. The ECB warns that companies in this sector expect higher increases in selling prices, labour costs, non-labour input costs, and employment over the next year compared to other sectors. These expectations highlight the continued inflationary challenges within the services industry, necessitating careful policy considerations.

Sectoral and Financial Insights

The survey also sheds light on the financial landscape for businesses. Companies reported more positive developments regarding the availability of bank loans, with fewer firms experiencing restricted financing conditions in the second quarter. Additionally, there was a slight decrease in the demand for bank loans and an improvement in the availability of these loans, suggesting a more favourable financing environment for businesses.

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Cyprus Income Distribution 2024: An In-Depth Breakdown of Economic Classes

by THEFUTURE.TEAM

December 24, 2025

New findings from the Cyprus Statistical Service offer a comprehensive analysis of the nation’s income stratification in 2024. The report, titled Population By Income Class, provides critical insights into the proportions of the population that fall within the middle, upper, and lower income brackets, as well as those at risk of poverty.

Income Distribution Overview

The data for 2024 show that 64.6% of the population falls within the middle income class – a modest increase from 63% in 2011. However, it is noteworthy that the range for this class begins at a comparatively low threshold of €15,501. Meanwhile, 27.8% of the population continues to reside in the lower income bracket (a figure largely unchanged from 27.7% in 2011), with nearly 14.6% of these individuals identified as at risk of poverty. The upper income class accounted for 7.6% of the population, a slight decline from 9.1% in 2011.

Income Brackets And Their Thresholds

According to the report, the median equivalent disposable national income reached €20,666 in 2024. The upper limit of the lower income class was established at €15,500, and the threshold for poverty risk was set at €12,400. The middle income category spans from €15,501 to €41,332, while any household earning over €41,333 is classified in the upper income class. The median equivalents for each group were reported at €12,271 for the lower, €23,517 for the middle, and €51,316 for the upper income classes.

Methodological Insights And Comparative Findings

Employing the methodology recommended by the Organisation for Economic Co-operation and Development (OECD), the report defines the middle income class as households earning between 75% and 200% of the national median income. In contrast, incomes exceeding 200% of the median classify households as upper income, while those earning below 75% fall into the lower income category.

Detailed Findings Across Income Segments

Upper Income Class: Comprising 73,055 individuals (7.6% of the population), this group had a median equivalent disposable income of €51,136. Notably, the share of individuals in this category has contracted since 2011.
Upper Middle Income Segment: This subgroup includes 112,694 people (11.7% of the population) with a median income of €34,961. Combined with the upper income class, they represent 185,749 individuals.
Middle Income Group: Encompassing 30.3% of the population (approximately 294,624 individuals), this segment reports a median disposable income of €24,975.
Lower Middle And Lower Income Classes: The lower middle income category includes 22.2% of the population (211,768 individuals) with a median income of €17,800, while the lower income class accounts for 27.8% (267,557 individuals) with a median income of €12,271.

Payment Behaviors And Economic Implications

The report also examines how income levels influence repayment behavior for primary residence loans or rental payments. Historically, households in the lower income class have experienced the greatest delays. In 2024, 27.0% of those in the lower income bracket were late on payments—a significant improvement from 34.6% in 2011. For the middle income class, late payments were observed in 9.9% of cases, down from 21.4% in 2011. Among the upper income class, only 3% experienced delays, compared to 9.9% previously.

This detailed analysis underscores shifts in income distribution and repayment behavior across Cyprus, reflecting broader economic trends that are critical for policymakers and investors to consider as they navigate the evolving financial landscape.

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