Romanians" purchasing power dropped in February for the second month in a row

AUra Dragomir

Romanians" purchasing power dropped in February, as the 0.2% increase of the average net wage was lower than the inflation rate, after wages dropped significantly in January, according to data published by the National Statistics Institute (INS).

The average net salary increased by 3 lei in February over the previous month, to 1.358 lei (317 Euros).

In real terms, considering the inflation rate for the same period, salary earnings dropped 0.7% in February. The yearly growth rate however, accelerated to 19.8%, up from 12.9% in January.

February is the second consecutive month where the purchasing power dropped, after the average wage dropped 9% in nominal terms, to 1355 lei (320 Euros). The evolution during the first two months of 2009 comes on the heels of the increase of the purchasing power for four consecutive months (September-December 2008).

Salary earnings increased 12.1% in real terms YOY, in February.

The gross salary was 1863 lei (435 Euros) in February, up 1.3% MOM.

Compared to October 1990, the purchasing power was 24.5% greater in February 2009, but it was however 0.8 percent below January"s level, NSI data shows.

The largest net salaries for the month of February were paid in the air transport industry (3313 lei/773 Euros), whereas the lowest wages were those in the hotels and restaurant industry (728 lei/170 Euros).

In February 2009, the average net salary for most economic activities was lower than in January, when occasional bonuses were given (yearly bonuses, 13th salary) or larger output was accomplished.

Thus, the average salary increases over January, for certain economic activities, were caused by the granting of bonuses or as a result of salary negotiations in industries such as the tobacco industry, activities ancillary to financial intermediation, insurance activities and pension funds, by the payment of the 13th salary for 2008 in the public administration and in the education sectors, as well as the payment of performance based bonuses in the chemical sector, rubber and plastic products sector, R&D, and waterway transports.

The net salary dropped 10% in sectors such as insurance, reinsurance and pension funds. Wages dropped 5 to 10% in sectors such as telecom, IT services, software services, printing and data recording, extraction of high and low quality coal, video, movie and TV production, audio recording and music editing activities (including broadcasting), editing, real estate transactions, production and distribution of electrical and thermal energy, gas, warm water and conditioned air, according to the National Statistics Institute.

Machinery and equipment manufacturing, the manufacturing of other transportation means, hotels and restaurants, ground transportation and pipeline transit, storage and transportation auxiliary activities, healthcare and social aid, waste water collection and treatment, waste collection, treatment and disposal; collection of recyclable materials; decontamination services saw the average net salary drop 3% to 4.5%.