OCDE - The real wage recovery is slowing down The OECD wage bulletin

The real wage recovery is slowing down The OECD wage bulletin 1

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

The real wage recovery is slowing down The OECD wage bulletin

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THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

This work is issued under the responsibility of the Secretary-General of the OECD, and does not necessarily reflect the official views of OECD Member countries. This document, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West B ank under the terms of international law.

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Disclaimers 3

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Real wages continue to rise in virtually all OECD countries. However, the pace of their recovery is slowing, while they remain below the levels seen in early 2021 – just before the post-pandemic inflation surge – in half of countries. In most OECD countries, real statutory minimum wages remain above January 2021 levels and continue to rise. As real wage growth slows down, the contributions of profits and wages to domestic price pressures tend to stabilise to patterns similar to those prevailing before the COVID-19 pandemic. Abstract4 

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Table of contents Disclaimers 2 Abstract 3 Executive summary 5 Labour markets have remained resilient but are weakening 6 Inflation has risen in a majority of countries 7

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Table of contents Disclaimers 2 Abstract 3 Executive summary 5 Labour markets have remained resilient but are weakening 6 Inflation has risen in a majority of countries 7 Real wage growth is slowing down, while there is still room for catching up in half of OECD countries 8 The wages of the lowest-paid workers have proved more resilient than median wages to the inflation surge 13 The catching up of real wages relative to unit profits may be slowing down 21 Conclusion 24 References 24 Notes 25 Contact 26

FIGURES Figure 1. Labour market tightness continued to decline and is now below pre-pandemic levels in many countries 6 Figure 2. Inflation has risen over the past year in a majority of OECD countries 7 Figure 3. Real wage growth is slowing down while real wages remain below Q1 2021 levels in half of OECD countries 9 Figure 4. Posted wages point to a recent slowdown in real wage growth 11 Figure 5. Real negotiated wages continued to increase 12 Figure 6. Real minimum wages remain above January 2021 levels and continue to rise 14 Figure 7. Statutory minimum wages have increased more than median wages 16 Figure 8. In-work poverty risk has decreased for minimum wage workers 17 Figure 9. The share of minimum wage workers evolved along different trends across countries during the costof-living crisis 18 Figure 10. There has been a clear trend towards wage compression between sectors since Q1 2021 in the United States but not in Australia or the euro area 20 Figure 11. Profits continue to buffer rising labour costs 21 Figure 12. The contribution of unit profits to domestic price pressures has stabilised around pre-pandemic levels in the euro area and the United States 23 5

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Key findings

Figure 12. The contribution of unit profits to domestic price pressures has stabilised around pre-pandemic levels in the euro area and the United States 23 5

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Key findings OECD labour markets have continued to show resilience, but new signs of weakening emerged over the past year, with a slowdown in employment and labour force participation growth, a further easing of labour shortages, and a deceleration of the real wage recovery. • The real wage recovery described in the previous bulletins is slowing down, while real wages remain below the levels seen in early 2021 (just before the post -pandemic inflation surge) in half of OECD countries. Annual real wage growth was positive in virtually all OECD countries in Q3 2025, but it was lower than one year earlier in three-quarters of them. It was 1.8% in Q3 2025 on average across countries, half of the Q3 2024 level. • Real statutory minimum wages remain above January 2021 levels and continue to rise. In January 2026, the real minimum wage was higher than both a year earlier and in January 2021 in most of the 30 OECD countries that have a national statutory minimum wage. • The wages of the lowest-paid workers have proved more resilient to the inflation surge than median wages. Statutory minimum wages have risen more than median wages since 2021 (i.e. Kaitz indexes have increased), and real wages have been more resilient in low wage sectors in some countries, reflecting a compression of the wage distribution at the bottom. As a result, minimum wage workers have become less at risk of in-work poverty. • As real wage growth slows down, the profit – wage “catch -up” phase may be shifting towards a steadier pattern of contribution similar to that seen before the pandemic. Unit labour costs continued to rise faster than unit profits between Q3 2024 and Q3 2025 in most

• As real wage growth slows down, the profit – wage “catch -up” phase may be shifting towards a steadier pattern of contribution similar to that seen before the pandemic. Unit labour costs continued to rise faster than unit profits between Q3 2024 and Q3 2025 in most OECD countries, but there are signs that the catching -up of real wages – following the disproportionate contribution of unit profits to the inflation surge in 2021-2022 – could be slowing down, with their relative contribution to domestic price pr essures stabilising around pre-pandemic levels in some countries.

Executive summary6 

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Labour markets have remained resilient but are weakening For the time being, geopolitical uncertainties and rising tariff rates have not significantly affected the resilience of OECD labour markets . Unemployment has stabilised at historically low levels in many countries, while employment and labour force participation rates have reached record highs on average across OECD countries – 72.2% and 76.7% respectively in Q3 2025. Matching efficiency is also back to pre-pandemic levels (OECD, 2025[1]). Nevertheless, there are some further signs of weakening in labour markets. Employment and labour force participation are slowing down, and labour markets have eased further over the past year in most of the OECD countries analysed in Figure 1, with labour market tightness now below pre-COVID-19 levels in more than half of them, consistent with slower wage growth (see next sections). Figure 1. Labour market tightness continued to decline and is now below pre-pandemic levels in many countries Difference in the vacancies-to-unemployed ratio relative to its Q4 2019 level

Note: OECD refers to the unweighted average of vacancies per unemployed across the 26 OECD countries shown in this chart (excluding Chile,

many countries Difference in the vacancies-to-unemployed ratio relative to its Q4 2019 level

Note: OECD refers to the unweighted average of vacancies per unemployed across the 26 OECD countries shown in this chart (excluding Chile, Colombia, Costa Rica, Czechia, Denmark, Iceland, Italy, Japan, Korea, Mexico , New Zealand, and T ürkiye). Europe (19) is the unweighted average of vacancies per unemployed across the 19 EU countries shown in this Chart. Czechia is not shown due to a major break in the vacancy series in Q1 2025, which led to the automatic removal of older vacancies from the register and resulted in a structural discontinuity.

The peak refers to the maximum value of the vacancies-to-unemployed ratio observed between Q4 2019 and Q3 2025. For Estonia and Latvia, this ratio remains below its Q4 2019 level throughout the period considered; therefore, no peak is identified for these countries. Statistics on job vacancies for Estonia and Switzerland are not seasonally adjusted. Vacancy statistics for France exclude “Public administrati on and defence; compulsory social security” (NACE Rev. 2 section O), while public institutions are not fully covered in “Education” and “Human health and social work activities” (NACE Rev. 2 sections P and Q). Labour-market tightness is measured as the number of job vacancies divided by the number of unemployed (ILO definition). Definitions of job vacancies are not fully harmonised across countries, which limits international comparability. For Israel, job vacan cies refer to posts for which employers are actively seeking a candidate from outside the enterprise following retirement, resignation or promotion. Covera ge is limited to enterprises with at least five employees and excludes public administration and defe nce, compulsory social security, and most education services, while including government-owned enterprises in the business sector and public hospitals. For country-specific vacancy definitions for all other countries, see the note to Figure 1.7 in OECD (2025[1]).

Source: Job Vacancies (ABS) for Australia; Job vacancies, payroll employees, and job vacancy rate (Statistics Canada) for Canada; Job

all other countries, see the note to Figure 1.7 in OECD (2025[1]).

Source: Job Vacancies (ABS) for Australia; Job vacancies, payroll employees, and job vacancy rate (Statistics Canada) for Canada; Job vacancies and labour turnover (Statistics Estonia) for Estonia, https://andmed.stat.ee/api/v1/en/stat/PAV011; Eurostat, Job vacancy statistics by NACE Rev.2 activity (Table jvs_q_nace2) for the European countries (not including Estonia and the United Kingdom); Job Vacancy Survey

(CBS) for Israel; Vacancy Survey (ONS) for the United Kingdom; and Job Openings and Labor Turnover Survey (Bureau of Labor Statistics) for the United States; OECD Data Explorer, “Monthly unemployment rates”, http://data-explorer.oecd.org/s/2aq (accessed on 16 December 2025). -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 Latest (Q3 2025) One year earlier (Q3 2024) Peak since Q4 2019 7

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Inflation has risen in a majority of countries Inflation (as measured based on the Consumer Price Index) has risen over the past year in a majority of OECD countries (Figure 2, Panel A) – the median annual percentage change in the CPI increased from 2.4% in Q4 2024 to 2.8% in Q4 2025 – with a particularly marked increase for food and non -alcoholic beverages – for which the corresponding CPI growth rose in 31 of the 38 OECD countries (Panel B). The rise in food and beverage inflation could weigh more heavily on low -income households, which tend to spend a larger share of their budget on these products (Caisl et al., 2023[2]).

beverages – for which the corresponding CPI growth rose in 31 of the 38 OECD countries (Panel B). The rise in food and beverage inflation could weigh more heavily on low -income households, which tend to spend a larger share of their budget on these products (Caisl et al., 2023[2]). However, i n all countries analysed, headline inflation has remained a long way from its 2022 peak. In Q4 2025, inflation in the OECD area (3.7%) was less than half its Q3 2022 level of 10.4% (OECD, 2025[1]), but still above 2%, which is the central bank target for many OECD countries ( e.g. the euro area, the United Kingdom and the United States). Inflation remains above this target in 32 OECD countries – 31.6% in Türkiye and above 4% in three other OECD countries. Figure 2. Inflation has risen over the past year in a majority of OECD countries Inflation defined as annual percentage change in the consumer price index (CPI), Q4 2025

-2 0 2 4 6 8 10 %

A. Total inflation (CPI, all items)

32 47 -2 0 2 4 6 8 10 %

B. Food and non-alcoholic beverages

30 46 Latest (Q4 2025) One year earlier (Q4 2024)8 

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Note: “OECD (average)” and “OECD (median)” are the unweighted average and the median across the 38 OECD countries, respectively.

Countries are ordered in descending order of the year-on-year percentage change in the consumer price index (all items) in Q4 2025 (Panel A). Due to missing data for the United States in October 2025, Q4 2025 data for the United States and for the OECD aggregate, are estimates

Countries are ordered in descending order of the year-on-year percentage change in the consumer price index (all items) in Q4 2025 (Panel A). Due to missing data for the United States in October 2025, Q4 2025 data for the United States and for the OECD aggregate, are estimates based on figures for November and December 2025. For the United States (and the OECD aggregate) , CPI for food and non -alcoholic beverages is an OECD estimate using CPI for All Urban Consumers (CPI -U): U.S. city average (Food at home) published by the Bureau of Labor Statistics (BLS).

Source: OECD Data Explorer, “Consumer price indices (CPIs, HICPs), COICOP 1999”, http://data-explorer.oecd.org/s/2aw, and “Consumer price indices (CPIs), COICOP 2018”, http://data-explorer.oecd.org/s/2ax (accessed on 09 February 2026).

Real wage growth is slowing down, while there is still room for catching up in half of OECD countries According to the latest data available for Q3 2025, annual real wage growth was positive in virtually all OECD countries, but was slowing down (Figure 3, Panels A and B), in line with rising inflation .1 The average annual growth in real wages across the 37 countries for which data are available was 1.8% in Q3 2025, half that recorded in Q3 2024, and annual real wage growth in Q3 2025 was lower than a year earlier in three-quarters of these countries. Real wage growth accelerated only in Belgium, Costa Rica, Czechia, Greece, Finland, Iceland, Luxembourg, Sweden and Switzerland. In addition, recent data on wages advertised in online vacancies for nine countries also indicate a slowdown in real wage growth in recent months (Box 1). Despite persistent annual growth, in Q3 2025, real wages remained below their Q1 20212 levels

wages advertised in online vacancies for nine countries also indicate a slowdown in real wage growth in recent months (Box 1). Despite persistent annual growth, in Q3 2025, real wages remained below their Q1 20212 levels (pre-dating the post-pandemic inflation surge) in half (19) of the 37 countries analysed (Figure 3, Panel C). Real wages were more than 2% below Q1 2021 levels in a quarter of countries: Australia and New Zealand, four Northern European countries (Denmark,3 Estonia, Finland, and S weden), two Central European countries (Czechia and the Slovak Republic) and two Southern European countries (Italy and Spain). It should be noted that wage recovery is slowing down in most of these countries, with annual real wage growth in Q3 2025 being lower than a year earlier – wage growth is accelerating only in Czechia, Finland and Sweden (Panels A and B). Nevertheless, real wages have regained some of the lost ground in all OECD countries – the two countries that have seen the weakest recovery in real wage since the trough of the cost-of-living crisis are New Zealand (with a 10% recovery) and Australia (with 16%). Beyond rising inflation (see previous section), there are several factors that could explain the slowdown in real wage growth over the last year. The easing of labour market tightness discussed above may have moderated the wages of new hires. On the institutional side, negotiated wages have been temp ered in some countries (see Box 2 and European Commission (2025[3])), while geopolitical and trade tensions have maintained a climate of high economic uncertainty.4 9

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Figure 3. Real wage growth is slowing down while real wages remain below Q1 2021 levels in half of OECD countries

-4 -2 0 2 4 6 8 10 12 14 16 %

A. Annual growth in nominal and real wages

Figure 3. Real wage growth is slowing down while real wages remain below Q1 2021 levels in half of OECD countries

-4 -2 0 2 4 6 8 10 12 14 16 %

A. Annual growth in nominal and real wages Year-on-year percentage change, Q3 2025 or latest

40 Nominal hourly wage Real hourly wage -20 -15 -10 -5 0 5 10 15 20 %

C. Real wages growth Percentage change since Q1 2021

76 Q1 2021-Q3 2025 percentage change Largest decline since Q1 2021 -4 -2 0 2 4 6 8 10 12 14 16 %

B. Annual growth in nominal and real wages Year-on-year percentage change, Q3 2024

79 16 Nominal hourly wage Real hourly wage10 

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Note: Unless otherwise indicated, nominal hourly wages correspond to the wages and salaries component of the Labour Cost Index, adj usted for a constant industry structure. : The constant -industry-structure adjustment of average hourly earnings has been estimat ed and revised by the OECD using total wages and salaries by industry from the 2019 Annual National Accounts. †: Nominal hourly wages refer to actual wages, without adjustment for compositional shifts; comparisons with other countries should therefore be i nterpreted with caution. ‡: Nominal hourly wages control for additional compositional effects depending on the country, including regions, job and worker characteristic s, gender, and occupations.

Nominal wage series are seasonally adjusted for all countries except Canada, Costa Rica, Israel, Mexico, New Zealand and Switzerland. For Japan, statistics refer to regular employees in establishments with five or more regular employees in all industries excluding agriculture, forestry, fisheries and government services. Regular employees are workers employed indefinitely or employed under a contract for a period of one

Japan, statistics refer to regular employees in establishments with five or more regular employees in all industries excluding agriculture, forestry, fisheries and government services. Regular employees are workers employed indefinitely or employed under a contract for a period of one month or longer. Statistics cover only the business sector (NACE Rev. 2 sections B to N) for the Republic of Türkiye. Statistics for Germany and Iceland refer to enterprises with 10 or more employees; for Ireland, to enterprises with three or more employees; for Greece, to enterprises with five or more employees; and for Poland, to entities or local units with 10 or more employed persons. For Finland, statistics cover the public sector and all private-sector enterprises with at least 20 or 30 employees. For Mexico, nominal hourly wages are affected by a significant degree of unreported income. Real hourly wages are calculated by deflating nominal hourly wages using the consumer price index (CPI, all items). In Panel C, the trough corresponds to the quarter in which real hourly wages reached their lowest level since Q1 2021. For Israel and Switzerland, the latest observation and the trough is identified among third-quarter observations only and corresponds to the lowest real hourly wage recorded since Q3 2020. Countries are ordered by descending order of the year -on-year percentage change in real hourly wages (Panel A). The latest observation available for Belgium refers to Q2 2025 (Q2 2024 in Panel B). OECD (average) and OECD (median) refer respectively to the unweighted average and the median across the 37 OECD countries shown in the chart (not including Colombia). Euro area (20) refers to the 20 Eurozone countries.

Source: OECD calculations based on national wage indices. For a full description of country -specific data sources, see Figure 1.15 in (OECD,

2025[1]). OECD Data Explorer, “Consumer price indices (CPIs, HICPs), COICOP 1999”, http://data-explorer.oecd.org/s/2aw, and “Consumer price indices (CPIs), COICOP 2018”, http://data-explorer.oecd.org/s/2ax (accessed on 07 December 2025). 11

THE REAL WAGE RECOVERY IS SLOWING DOWN © OECD 2026

Box 1. Online vacancies from selected OECD countries point to a recent slowdown in the growth of real posted wages Data on advertised wages from job postings on the online platform Indeed1 indicate a slowdown in the growth of real posted wages between August 2025 and January 2026 in most countries for which data are available. In only two countries real wage growth is rising (Germany) or real wage contraction is slowing down (Italy) (Figure 4). Germany is the only country where nominal wage growth has been steadily rising; the slowdown in real wage contraction in Italy is mainly due to the reduction in inflation. In countries where real wage growth is decreasing, this can be mainly due to rising inflation (Canada and Ireland) or falling nominal wage growth (France, Spain and the United States). In the Netherlands, the United Kingdom and the euro area as a whole, nominal wage growth has been following disinflation, so that real wage growth has remained virtually constant. Figure 4. Posted wages point to a recent slowdown in real wage growth Year-on-year percentage change, three-month moving averages, from August 2025 to January 2026

Notes: Posted wages refer to the average year -on-year percentage change in wages and salaries advertised in job postings on Indeed.

Inflation refers to the Consumer Price Index (CPI, all items). As CPI data for the United States were not published for October 2025, the three-month moving averages for October, November and December 2025 are based on two months only, excluding October 2025.

Inflation refers to the Consumer Price Index (CPI, all items). As CPI data for the United States were not published for October 2025, the three-month moving averages for October, November and December 2025 are based on two months only, excluding October 2025.

Source: Indeed Wage Tracker ( https://github.com/hiring-lab/indeed-wage-tracker); OECD Data Explorer, “Consumer price indices (CPIs, HICPs), COICOP 1999”, http://data-explorer.oecd.org/s/2aw, and “Consumer price indices (CPIs), COICOP 2018”, http://dataexplorer.oecd.org/s/2ax (accessed on 27 February 2026).

1. Indeed data are subject to a number of limitations, including the over-representation of high-skilled jobs, and the under-representation of low skilled jobs, jobs posted by small firms and the agricultural sector. Nevertheless, there is evidence that job postings a t the aggregate level tend to track well with job vacancies from government sources (Adrjan and Lydon, 2023[4]; Adrjan et al., 2021[5]; Bellatin and Galassi, 2022[6]; Ciminelli et al., 2024[7]).

0 1 2 3 4 5 6 Canada Euro Area France Germany Ireland Italy Netherlands Spain United Kingdom United States % Posted wage growth Inflation12 

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Box 2. Real negotiated wage growth in selected OECD countries is slowing down, while there is still room for catching up Real negotiated wages (i.e. wages defined in collective agreements, as opposed to those actually paid to workers) continued to increase, albeit at a slower pace than a year earlier ( Figure 5). Growth in real negotiated wages between Q3 2024 and Q3 2025 was positive in virtually all countries analysed,

to workers) continued to increase, albeit at a slower pace than a year earlier ( Figure 5). Growth in real negotiated wages between Q3 2024 and Q3 2025 was positive in virtually all countries analysed, although generally lower than between Q3 2023 and Q3 2024 – only Sweden recorded a marked acceleration. Nevertheless, in all countries except Denmark, where they have fully recovered, and Mexico, where they did not fall with the inflation surge (OECD, 2025 [1]), real negotiated wages remain below the levels observed just before the post -COVID-19 inflation surge ( Figure 5). Still, in Q3 2025, real negotiated wages were less than 2% below their Q3 2020 levels in about half of the countries analysed (Austria, Belgium, France, the Netherlands and the United States). Looking at the euro area as a whole, real negotiated wages have remained stable over the past year at 4.9% below their Q3 2020 level. The dynamics of real negotiated wages reflect a combination of factors, including the staggered and infrequent nature of collective bargaining, the time lag between the completion of negotiations and actual wage revisions, the infrequent use of automatic i nflation indexation, and workers’ bargaining power (OECD, 2023[8]). Since the start of the cost -of-living crisis, as bargaining rounds have multiplied and affected a growing number of workers, negotiated wages have regained more and more of the ground lost during the inflation surge. Looking ahead, the European Central Bank’s (ECB) wage tracker forecasts annual nominal negotiated wage growth to stabilise at around 2% in Europe during the first three-quarters of 2026, which is similar to the level seen in the second half of 2025 and about half that of the first half of 2025.1 Figure 5. Real negotiated wages continued to increase Percentage change in real negotiated wages (i.e. resulting from collective agreements) since Q3 2020

to the level seen in the second half of 2025 and about half that of the first half of 2025.1 Figure 5. Real negotiated wages continued to increase Percentage change in real negotiated wages (i.e. resulting from collective agreements) since Q3 2020

Note: International comparability of data on negotiated wages is affected by differences in definitions and measurement. Statistics are representative of all employees covered by a collective wage agreement for Austria, Belgium, the euro area (20), France, Germ any, Italy, the Netherlands, Sweden and the United States. In Canada, statistics refer to collective bargaining settlements of all bargaining units covering 500 or more employees (units of 100 or more employees for the Federal Jurisdiction). In Denmar k, statistics refer to collective agreements

-15 -10 -5 0 5 10 15

MEX NLD

(LS)

NLD AUT CAN EA20 DEU

(LS)

DEU AUS SWE ITA

%

A. All sectors

-15 -10 -5 0 5 10 15

DNK USA BEL NLD

(LS)

NLD FRA AUT CAN USA

(LS) DEU (LS)

DEU AUS ITA SWE

%

B. Private sector Q3 2025 ( ) Q3 2023 Q3 2024 13

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negotiated by the main union and employer confederations, FH and DA, and do not cover public sector employees and the academic unions (AC). For Australia, Canada and Mexico statistics refer only to employees affected by an increase of the negotiated wage a t date. For Denmark, wage increases cover basic wages, employer pension contributions, “fritvalg” (flexible benefit) accounts, and other collectively agreed elements (e.g. wages in the event of sickness absence or maternity/paternity leave) from the five major sectoral collective agreements (the “breakthrough agreements”) that set the financial framework for the subsequent minimum wage agreements or standard wage

agreed elements (e.g. wages in the event of sickness absence or maternity/paternity leave) from the five major sectoral collective agreements (the “breakthrough agreements”) that set the financial framework for the subsequent minimum wage agreements or standard wage agreements to be negotiated in the private sector. Calculations are based on the assumption of full relative pass -through of centrally negotiated wage rates to actual wage adjustments ( i.e. a 1% increase in the minimum wage or standard wage rate leads to a 1% increase in locally negotiated wages higher up the wage distribution). Wage increases in Au stria, Belgium, the euro area (20), Germany, Italy, the Netherlands, Sweden and the United States refers to the average increase in negotiated wages weighted by the employment composition for a reference year (Laspeyres index). The reference year of the em ployment composition used is 2009 for Sweden, 2010 for Belgium, 2015 for Germany and Italy, 2016 for Austria, 2020 for the Netherlands, 2021 for the United States, and January 2023 for the euro area (20). For Australia, Canada, France and Mexico wage incre ases refer to the average increase in negotiated w