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The National Institute of Statistics and Economic Studies (STATEC) has confirmed that the next wage indexation will be triggered before summer.
Only a few months after salaries increased in October 2021, a new wage indexation will be triggered in Luxembourg.
According to the latest estimates by STATEC, the price increases of the past months will relatively quickly pass the threshold required to trigger the next wage indexation. STATEC currently predicts that the next wage indexation will be triggered in the second semester of 2022, i.e. between April and June. When triggered, the indexation will automatically increase all wages, salaries, and pensions by 2.5%.
Besides rising energy prices, STATEC also notes that other consumer sectors are also affected by price increases. The Institute explains that this is due to the coronavirus pandemic continuing to disrupt global production chains while demand remains high. Taking into account the effects of both the health crisis and the rising prices of petroleum products, inflation could reach 4.4% this year.
Depending on how much prices will increase, it is possible that there will be another wage indexation in late-2022. This would require a particularly high inflation rate of 4.8%. With the expected inflation rate of 4.4%, the next wage indexation would likely be triggered in early-2023. If the current trend would slow down, on the other hand, the wage indexation would be pushed back to 2024.