In 2025, many wage earners will see their pay rise. However, the increases may not be sufficient to cover the rising costs, rising health insurance premiums in particular.
Who will receive more pay next year? Migros and Coop, Switzerland’s two largest private employers have announced pay increases of 1% to 1.3%, reported SRF. Denner, which is part of the Migros group, has said it will boost pay by 1.1% next year. Airline Swiss, another large employer, has announced a 2% pay boost. Other pay hikes have yet to be announced or negotiated. Swiss Rail remains in pay negotiations.
Based on a wage survey run by bank UBS in November 2024, wages are expected to rise on average by 1.4% next year. Another survey run by Switzerland’s Federal Institute of Economic Research (KOF) estimates a 1.6% average pay boost in 2025.
Sectors with highest expected wage increases include IT and telecommunications, followed by the energy, chemical and pharmaceutical sectors. Those working in IT and telecommunications are expected to get a 2% boost in pay. Those working in retail and media are likely to see less, according to UBS.
How do these increases compare to inflation? The Swiss National Bank (SNB) is forecasting 0.6% inflation in 2025. Estimated average pay rises are above this rate, so real wages will rise next year. However, recent pay increases have not kept pace with inflation, leaving Swiss salary earners worse off in real terms. Real wage development (pay increases less inflation) over the last three years has been negative. Average real wages fell by 0.8% in 2021, by 1.9% in 2022, and by 0.4% in 2023. Together these add up to a 3.1% decline in real wages. At the same time Switzerland has historically experienced deflation, which boosts real wages. This happened in 2020 when inflation was -0.7%. If this is included, the fall in average real pay is 2.4%, assuming no pay increase was received in 2020.
Against this background Switzerland’s Federation of Trade Unions is calling for a general pay hike of 5% and a boost to the minimum wage. In response the employers’ association says the demand is unrealistic.
More on this:
SRF article (in German)
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