A report released on Thursday by the International Labour Organization (ILO) indicates that average wages have begun to rise at a pace that exceeds global price growth, underscoring ongoing “significant” wage differentials.
The “World Wage Report 2024-25” reveals that following a decline of 0.9% in 2022, real wage growth worldwide rebounded in 2023, driven by a gradual decrease in inflation. The report shows an increase of 1.8% overall, or 1.3% when excluding China, which has been experiencing rapid wage growth.
Preliminary data for the first two quarters of 2024 suggest a rise of 2.7% this year (2.3% when excluding China), marking the most substantial increase recorded in the past 15 years, according to the ILO.
However, wage growth remains uneven across regions, with emerging economies exhibiting stronger increases compared to advanced economies, the ILO reports.
In the G20 advanced economies, which experienced declines in both 2022 and 2023, wage growth has turned positive again, reaching 0.9% in 2024. In contrast, emerging G20 economies saw an impressive increase of 5.9%, maintaining positive growth in both 2022 and 2023.
“The return to positive real wage growth is a welcome development,” said ILO Director-General, Gilbert F. Houngbo. “However, we must not forget that millions of workers and their families continue to suffer from the cost-of-living crisis that has eroded their living standards and that wage disparities between and within countries remain unacceptably high.”
The report highlights that since 2000, wage inequality—measured by comparing high and low wages—has decreased in “approximately two-thirds of all countries.” Depending on the methodology used, this decline ranges from 0.5% to 1.7% per year.
Despite this encouraging trend, “significant wage differentials persist worldwide,” notes the ILO. The report reveals that worldwide, “the lowest-paid 10% of workers earn only 0.5% of total global wage income, while the highest-paid 10% account for nearly 38% of this total.”
