Long and Severe Income Losses During the Greek Crisis
Research
30.07.2026
ZEW Study on Wage Developments in Greece Since 2002
Following the economic crisis from 2009 to 2013, wages in Greece recovered only partially. Meanwhile, fluctuations in income, the risk of social decline and inequality increased significantly. Young labour market entrants and workers with middle and low incomes were particularly affected and continue to feel the consequences today. This is shown by an international study in which ZEW Mannheim was also involved.
“Incomes in Greece followed a trend relatively similar to that of the economy as a whole. In the boom years before the crisis, incomes rose, while during the crisis from 2009 to 2013 they fell sharply. Over the following ten years, they recovered slowly and only partially,” says study co-author Efi Adamopoulou, PhD, deputy head of the ZEW “Inequality and Public Policy” Research Unit.
Fundamental Change in Income Dynamics
During the economic crisis, income volatility, wage risks and inequality rose sharply. Although these patterns weakened over time, many incomes remained below their pre-crisis levels even ten years after the end of the crisis.
The study shows that the decline in real incomes was exceptionally severe and long-lasting across the distribution. The data also show that income losses occurred not only at the lower end of the distribution but extended well into the middle, while higher incomes recorded significantly smaller losses.
Labour Market Entrants Particularly Affected
“Labour market entrants started with significantly lower incomes and were unable to fully make up this gap in the following years. As a result, cohorts entering the labour market from 2009 onwards began their careers with increasingly lower starting salaries. Even after nine years of work experience, their income trajectories remained below those of pre-crisis cohorts. Although the difference narrowed over time, the traces of these ‘unfortunate cohorts’ are still visible today. The effects are around twice as severe among employees with lower levels of education as among those with medium and higher levels,” says Adamopoulou.
As Greece initially experienced strong growth in the 2000s, labour market conditions deteriorated massively during the crisis. The unemployment rate rose to 27.7 per cent by 2013 and the real average wage fell by almost 30 per cent during the crisis. At the same time, far-reaching labour market reforms were implemented in 2012, including a nominal reduction of the national minimum wage by 22 per cent and a significant weakening of collective bargaining coverage.
Data Analysed for 21 Years
The study is based on administrative employer-employee data from the Greek social insurance system (IKA/EFKA) for the period from 2002 to 2023. These data include monthly information on income, occupation, company, sector and region, and cover the majority of private-sector employees in Greece. A representative panel dataset was created from these data, covering around 20 per cent of insured employees. The results form part of the Global Repository of Income Dynamics, which harmonises comparable income data from several countries.
