Countries with the Highest and Lowest Minimum Wages in Europe:
When comparing minimum wages across European countries, it's essential to consider purchasing power standards (PPS) to account for the cost of living differences. This adjustment provides a fairer comparison of worker purchasing power, as it reflects what wages can actually buy locally.
A stark geographical divide in nominal minimum wages across Europe is most notably between Western and Eastern Europe. However, when wages are adjusted for PPS, the disparities decrease, elevating the relative standing of some Eastern and Balkan countries.
As of July 2025, Luxembourg has the highest minimum wage both nominally (€2,704) and in PPS (2,035 PPS). Yet, the difference with lower-wage countries shrinks significantly after adjustment. For instance, Luxembourg only pays about 2.3 times more than Estonia, which has the lowest PPS-adjusted minimum wage in the EU at 886 PPS.
Including EU candidate countries like Albania and Ukraine lowers the PPS minimum wage ranking further, with Albania at 566 PPS and Ukraine as low as €164 nominally. Other top EU countries by PPS minimum wage include Germany (1,992 PPS), the Netherlands, Belgium, Ireland, and France.
Eastern European and Balkan countries improve their relative position noticeably when wages are adjusted for PPS due to generally lower living costs. Some EU countries do not have a national minimum wage, such as Italy, Denmark, Sweden, Austria, and Finland. Cyprus ranks 15th in the EU with a minimum wage PPS of 1,078.
When adjusted for PPS, the wage gaps between countries become significantly narrower. Countries in the highest wage group are mainly in Western and Northern Europe, while the low and very low groups consist mostly of Eastern European, Balkan, and EU candidate countries. One PPS is an artificial currency unit that, in theory, buys the same amount of goods and services in every country.
High-tech industries typically show higher productivity levels, leading to sustainably higher wages and salaries. Economies with more industrial or financial activity tend to be more productive. Higher bargaining power for workers is another factor influencing wages.
In summary, Western European countries lead in both nominal and PPS-adjusted minimum wages. However, the cost-of-living adjustment reduces disparities, elevating the relative standing of some Eastern and Balkan countries. When comparing minimum wages across countries, purchasing power standards (PPS) are crucial due to the wide variation in cost of living.
- The high-tech industries, known for their higher productivity levels, contribute to sustainably higher wages and salaries, which could potentially close the gap between the nominal minimum wages in Western Europe and those in Eastern and Balkan countries.
- As the workers in some Eastern and Balkan countries have generally lower living costs, their improved relative position when wages are adjusted for purchasing power standards (PPS) may lead to increased competitiveness in the global business and finance sectors, potentially attracting more foreign investments.
