The government of Cyprus has approved a new minimum wage. This decision will help many low-wage workers. The change was made after many discussions. It will start on January 1, 2026. About 50,000 people will receive more money.
The monthly minimum wage will increase. Workers with more than six months of service will earn €1,088. Before, they earned €1,000. For new workers, the wage will go up to €979. This is an 8.8% rise for long-term employees. The government hopes this will help people buy more things. It also aims to reduce poverty.
The government looked at the economy. Inflation was 1.8% in 2024. It is expected to be 0.2% in 2025. Economic growth was strong. GDP grew by 3.9% in 2024. It is expected to grow by 3.4% in 2025. The unemployment rate is also falling.
However, trade unions are not happy. They wanted a higher increase. They said a wage below €1,125 would cause problems. They feel the 8.8% rise is not enough. They want workers to earn more to cover living costs.
Employers are also unhappy. They called the 8.8% increase "unprecedented." They believe the new minimum wage is too high. It might be higher than in countries like Germany. They worry that small businesses will struggle. This could lead to higher prices for everyone.
The Labour Minister explained the decision. He said it is hard to find a balance. The government wants to protect workers and businesses. They hope the wage increase will not cause problems. Discussions will continue in 2026.