Employers face huge costs when paying salaries over 2,000 euros

Employers face huge costs when paying salaries over 2,000 euros

The number of senior corporate officials continued to decline in the third quarter of the year, while part-time work and employment at the minimum salary level of 586 euros per month are virtually the only options out there for job seekers. The reason for this state of affairs lies in the prohibitively high taxes and social security contributions that employers are expected to pay.

For an employee to receive over 2,000 euros net per month, their employer must pay more to the state – in taxes and contributions – than to the worker. When an employee collects 3,000 euros, their final cost to their employer each month is 7,1278 euros, of which 4,134 euros goes to the state (58 percent of the total).

In the case of part-time employment, however, the cost is much lower. For example, for an employee working 22 days a month, the additional cost for the employer is just 127 euros per month – that for social security contributions.

Meanwhile, for a full-time employee on a monthly salary of 586 euros, the state gets no more than 240 euros, as no income tax or solidarity levy is imposed. In practice, this means that it takes five or six workers’ social security contributions to pay the average monthly pension.

Hellenic Statistical Authority data for Q3 show a decline in the unemployment rate, but this is due to the increase in temporary jobs, the hiring of staff in the service industries (mainly restaurants and hotels), and unskilled workers getting the minimum salary of 586 euros.

The same figures also reveal a drop in the number of managerial jobs, as in Q3 there were 94,600 people in senior posts, against 98,000 a year earlier. The reason is obviously financial due to the costs such posts entail, leading to more flexible forms of labor.

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