Fiscal Council president Michalis Persianis told Politis Radio that Cyprus’s wage and inflation statistics, while technically accurate, fail to reflect the real distributional pressures experienced across the economy.
Speaking on Politis Radio 107.6 & 97.6, in connection with the Fiscal Council’s annual report for 2025, Persianis noted that average wages are rising but income growth is not evenly shared.
He stated that in some sectors “wages are high and continue to increase”, while in others earnings have remained static for years. According to an initial estimate, roughly 37 to 40 percent of workers are doing well, “but the rest are not”, he said.
Wage growth uneven across sectors
Persianis emphasised that headline wage data obscure significant disparities. Strong increases in areas such as professional services, finance and technology contrast sharply with stagnation in lower-paying sectors, creating a widening gap in disposable incomes.
Domestic inflation still pressuring households
The same uneven trend is visible in inflation, he added. While the recent decline in headline inflation is driven mainly by lower prices on imported industrial goods, energy and fuel, domestically produced goods and services continue to become more expensive, placing sustained pressure on households.
Concerns over rising rigid expenditures
Persianis also reiterated the Fiscal Council’s long-standing concern about the growth of inelastic public expenditures, even as the economy maintains strong momentum and public debt falls below the 60 percent threshold.
He warned that Cyprus faces substantial future spending obligations in infrastructure, energy, water management and climate-related disasters. “We need to start planning for these now,” he said, noting that rising structural costs could strain fiscal stability if left unaddressed.