In fact, the minimum wage in Latvia is 914.93 euros / day

At the cost of the employer, the minimum wage in Latvia is not EUR 740, but EUR 914.93, which must be taken into account by decision -makers in assessing Latvia’s competitiveness in Europe.

From time to time in Latvia the minimum wage is raised and comparisons are made with its size in other countries, especially in the same way with Lithuania and Estonia. The situation is even more spicy that the official minimum wage in all Baltic States was very similar in the year 2015: € 390 in Estonia; In Latvia – 360 euros; In Lithuania – 325 euros, but in 2025, respectively, 886 euros; 740 euros; 1038 euros. Many have a real desire to equalize the minimum wage level in the Baltics, but the fact of the minimum wage for the employer is ignored. For example, in 2023, the national minimum wage of 620 euros actually cost the employer 766.62 euros, in 2024 the minimum wage of 700 euros was already € 865.49, but in 2025, EUR 740 is actually EUR 914.93. Calculation data shows that the cost of the employer (tax and fee) above the national minimum wage in 2023 amounted to EUR 146.62 more, in 2024 in 2024 – EUR 165.49 and already in 2025.

What increases this minimum wage cost? The formula of the national calculation, as the employer of the national minimum wage in Latvia has to pay the state social insurance compulsory contributions of 23.59%, which in 2025 is EUR 174.57 per month, which still has to add 0.36 euros per month.

Is everywhere the same?

You may ask if this minimum wage in other countries is exposed to the extra cost of employers. Yes, but there are sufficient differences between the Member States of the European Union. It shows a/s Bdo latvia A study on the amount of employer costs relative to the national minimum wage. « In almost every country, employers have to count on additional costs to meet the minimum wage condition, » explains JSC Bdo latvia Partner Viesturs Briezkalns. He rushes to emphasize that these additional cost levels in different countries are very different. « Here in the southern neighbor in Lithuania, the employer is only € 18.37 over the minimum wage of 1038 euros, in Romania over 840 euros minimal wages is another 50.88 euros, while Latvia is more likely to pay € 174.93 in Latvia, while in the Northern North V. Briezkalns points out the « premium » range. He says that even more impressive employer « premium » is in Spain – € 420.93.

In Lithuania only +1.77%

The scene is even more colorful by the amount of « bonuses » of the employers, expressing it as a percentage against the minimum wage set in the country concerned. Bdo latvia The study shows that it is only 1.77%in Lithuania, 6.25%in Romania, 23.6%in Latvia, 33.8%in Estonia and 30.48%in Spain. « It just confirms that the minimum wage is quite different from the cost of the employer, so comparable data should be used for comparison, » V. Briezkalns advises. You can only agree with this view and invite all employers, employees and public administration and, in particular, decision -makers to be aware of these essential nuances.

Paradoxy

Bdo latvia The study data shows a nearly or incredible picture, namely, in Romania, the minimum wage is legally higher (814 euros per month) than in Latvia (740 euros), but at the cost of the employer, Latvia is « more expensive » because the employee costs 914.93 euros with such a minimum wage for an entrepreneur. Of course, you can look for and find more expensive countries than Latvia, however, if the European Union does not have a common approach to this minimum wage, even more so with the associated employers’ bonus, then seeing only one minimum wage, not only does it arise. This is especially important in the current circumstances where – like or dislike – the economy is generally at best in stagnation. V. Briezkalns, on the other hand, points out that there are countries (Finland, Sweden), where there is no minimum wage at the national level. In Sweden, for example, the minimum wage in each sector is determined by the recognized institution.

That obtains from a minimum wage increase

Although raising the minimum wage publicly tries loudly to link to less paid workers, which is also happening because small wage recipients make more money, but is shyly concealed (perhaps not asked) that such a step increases the cost of many employers and forces them to raise their goods and services. and excise tax, income. You can already comfort, say that entrepreneurs do not have much to increase the minimum wage, because there are not many of them, but again, we also need to increase the minimum wage for those who get more. And increasing the minimum wage increases the cost of public sector, which can only be used to remove jobs, not to mention freezing, or even more reduction. This is how a vicious circle is created, as it is in the public sector that wage costs will be the first requirement to raise state revenue, but it looks the simplest to travel the minimum wage.

Other factors

The minimum wage can also serve as one of the indicators of foreign investors, as obviously issues may arise why the minimum wage in Estonia or Lithuania is significantly higher. Is it really cheaper in Latvia? And what is the reason for this – is it really purchasing power – lower price levels than in neighboring countries, lower labor qualifications or the share of the shadow economy? Potential foreign investors, when assessing their costs, sometimes ask these « additional » costs from the employer’s pocket, which is paid to the minimum wage. The minimum wage system without employer bonuses is like a crooked mirror, and we care about it! And after all, the minimum wage does not mean that the employee will see that amount in his purse. Only adequate comparable data are used in the right, appropriate decision -making decision that would not mislead the public and the decision -makers themselves.