Amid the ongoing economic crisis and constant announcements of companies cutting staff and ending production, the National Statistical Institute (NSI) said salaries in Bulgaria had increased in the second quarter of the year by 15.3 per cent on average, as opposed to figures from the corresponding period in 2008.

In the public sector, the rise was 16.9 per cent, whereas in the private sector the boost was 14.3 per cent. In July, wages increased by 4.4 per cent to 588 leva, or eight leva up on March this year.

NSI data, released on August 11, also said that the largest increase in average wages, on an annual basis, was registered in the cultural, sports and entertainment sector, reaching 26.8 per cent, followed by construction at 26.2 per cent. The lowest rate of increase was observed in the scientific research sector, 3.8 per cent, and mining and manufacturing 2.8 per cent.

Those working in the finance sector kept their lead as the highest paid employees with an average monthly salary of 1355 leva, followed by people employed in the electric supply and heating sector with 1321 leva a month and the media sector with 934 leva a month.

Although tourism has long been described as one of the backbones of Bulgaria’s economy and has a vital place in the country’s long term economic strategy, the lowest wages were registered in the hotel sector, 387 leva a month, administrative support, 425 leva, and agriculture, 446 leva a month.

The NSI data comes just two weeks after it said that the overall business climate indicator in the country in July had decreased by 1.2 percentage points from June with industry and retail trade cited as the aggravating factors. The month saw the composite business climate indicator in industry decrease by 4.3 percentage points from June, reaching an all-time nadir after an already worsening trend.

The explanation was that managers had low evaluations of the present business situation mixed with more pessimistic forecasts about the next six months. The order book of industrial enterprises (measured in the number of months) dropped from 5.0 in April to 4.4 months in July while in 2008 it was 5.9 months’ long. This, according to some media reports, has made managers consider more staff reductions in coming months with the industrial sector suffering the severest pressure. Hence NSI’s August 11 data came as a surprise.

According to Kamen Kolev, from the Bulgaria Industrial Association, the figures were rather absurd considering the ongoing crisis. "The explanation for this illogical situation lies in the over-expanded administration which leads to more salaries paid to people, hence more income taxed by the authorities," he told Bulgarian-language Dnevnik daily on August 11. Another reason for the wage hike could be the cutting of staff, leaving managers more money to distribute among their employees," Georgi Ganev, from the Centre for Liberal Strategies, told Dnevnik.