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WORKING IN SWITZERLAND

Why Swiss employees may get higher wages in 2024

Despite recent predictions to the contrary, salaries in Switzerland look set to increase next year.

Published: 13 November 2023 15:14 CET
A person looks at their credit card
Swiss workers may see a wage increase next year. Photo: Jan Vašek from Pixabay

There have been concerns lately that any wage hikes that employees in Switzerland will get in 2024 will be mostly eaten up by inflation.

So, while their nominal salaries (that is, not adjusted for inflationary forces) were to be higher on paper, real wages they will actually receive, which are adjusted for inflation, were forecast not to go up. 

A recent UBS survey confirmed earlier findings showing that the expected average wage growth of 1.9 percent next year would not be enough to offset inflation — also hovering at about 1.9 percent.

In fact, “we expect a drop in household disposable income of 0.1 percent,” said UBS economist Maxime Botteron.

However, the latest forecast is not quite as glum.

In an interview with Swiss media on Monday, Severin Moser,  president of the Swiss Employers’ Union, said that a real increase in wages should not be ruled out.

How much of a hike can employees in Switzerland expect?
 
While the 4 to 5-percent increase, as demanded by trade unions, is not realistic right now, “I believe that salary increases could be higher than the inflation rate,” Moser said, though exact increases are yet to be determined.

As always, they will depend not only on specific sectors, but also on individual jobs within those sectors.

READ ALSO: What are Switzerland’s highest paying jobs?

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WORKING IN SWITZERLAND

Switzerland sees record high immigration from European countries

Switzerland has seen record immigration from European countries and a new report reveals a correlation with the country's low unemployment rate.

Published: 25 June 2024 11:28 CEST
Switzerland sees record high immigration from European countries

Lots of data indicates that Switzerland needs foreign workers to fill job vacancies.

Now a report from the State Secretariat for Economic Affairs (SECO) confirms the importance that employees from the European Union and EFTA (Norway, Iceland, and Liechtenstein) have had for Switzerland’s labour market and economy in general. 

That is why “demand for foreign labour was strong in Switzerland in 2023,” SECO said in its annual report published on Monday, which assessed the impact that the Free Movement of Persons agreement (FMPA) has had on the country’s employment.

In 2023, 68,000 people from EU and EFTA countries came to work in Switzerland, according to SECO, driven by “employment growth that has significantly exceeded the EU average.”

Why does Switzerland need EU / EFTA workers?

Simply put, they are needed for the country’s economy to function optimally.

As SECO pointed out, while the number of pensioners is growing (due mostly to Switzerland’s exceptionally high life expectancy), “Swiss working-age population has experienced only slow growth over the past 20 years.”

“The country’s economic growth is not possible without immigration,” said Simon Wey, chief economist at the Swiss Employers’ Union. “We need foreign labour if we want to maintain our level of prosperity.”  

READ ALSO: How EU immigrant workers have become ‘essential’ for Switzerland 

In what sectors is the need for these workers the highest?

“A large number of people from the EU coming to work in Switzerland are highly qualified and are employed in demanding activities in high-growth branches of the service sector, such as the branch of special, scientific and technical activities, that of information and communication or the health sector;” SECO’s report said.

But the Swiss economy also recruits EU nationals as low-skilled labour, particularly in the hotel and catering industry, as well as construction and industry.

Why are only people from the EU / EFTA states recruited?

The reason is that, unlike nationals of third countries, people from the EU / EFTA have an almost unlimited access to the Swiss employment market, thanks precisely to the FMPA. 

Also, those coming from the neighbour countries (as most of Switzerland’s foreign labour force does), have the required language skills to easily integrate into the workforce in language-appropriate Swiss regions.
 

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