China, Russia among nations with real wage growth in 2023: UN
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According to a UN analysis, China, Russia, and Mexico were the only top economies with positive real wage growth in 2023.
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Workers assemble speakers at an electronics factory in Linquan in central China on May 31, 2023. (AP)
A new UN report issued this week revealed that only three G20 nations saw real salaries increase last year.
According to the analysis, China, Russia, and Mexico were the only top economies with positive real wage growth in 2023. Real wages are defined as the amount of money an individual keeps after accounting for the effects of inflation or stated in terms of purchasing power rather than real income.
The United Nations' International Labour Organization released the "World Employment and Social Outlook Trends 2024" report. According to the findings, China and Russia had the most benefits, as their worker productivity growth was among the highest in the G20 group.
Other big economies saw real wages fall, with Brazil, Italy, and Indonesia experiencing the worst drops, according to the findings.
“The vast majority of G20 countries with available wage data saw real wages fall in 2023, meaning that wage increases were unable to keep pace with inflation,” the report reads.
Last year, economic growth in Europe and Central Asia, as measured by the UN Labor Department, fell for the third straight year, according to the report. The World Bank, on the other hand, forecasts economic growth to go up in 2024, owing in part to improved performance in Poland, Russia, and Turkey.
According to the World Bank's latest predictions, Russia's economy would grow by 1.3% in 2024 and 0.9% in 2025, after exceeding expectations in 2023.
China records fastest deflation in three years
An earlier report in December by China's National Bureau of Statistics indicated that consumer price decreases in China quickened in November, meaning the country's post-pandemic economic recovery may take longer than originally anticipated.
The consumer price index (CPI) decreased 0.5% year on year in November, the largest reduction since November 2020. Consumer prices have been influenced in part by a drop in pork prices, which is a substantial component of China's CPI basket due to its popularity among consumers. In November, overall food costs in the country fell by 4.2%.
While the bulk of the world's countries have struggled with inflation this year, researchers warn that China's plummeting prices might be just as problematic. Deflation can cause a slowdown in economic activity and halt growth since individuals are likely to buy less because they expect prices to fall further, and firms may begin to curtail output and investment owing to falling demand.
Most analysts predict that China will fail its 3% annual inflation target this year and that deflation will likely endure throughout the first half of 2024.
