Salaries in Europe in 2026: where do they pay more?

The latest figures for 2026 reveal Europeans’ real incomes. The nominal frontrunners are losing ground to countries with a lower cost of living, and taxes make all the difference. Find out which countries pay the most when purchasing power is taken into account

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The European labour market in 2026 continues to show significant economic disparities. According to the latest report by the Organisation for Economic Co-operation and Development (OECD), ‘Taxation of Wages’, the gap between the wealthiest and developing countries on the continent remains vast. The annual pre-tax earnings of full-time workers range from a modest €18,590 in Turkey to a substantial €107,487 in Switzerland. The study covered 27 countries, including 22 EU member states, clearly demonstrating that geographical location continues to be a major determinant of citizens’ financial well-being.

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What will the average salary in Europe be in 2026?

Looking at the overall picture across the continent, the average figures show a marked disparity. Switzerland has cemented its status as the clear leader, becoming the only European country where the average annual income has comfortably surpassed the €100,000 mark. At the other end of the scale are the countries of South-Eastern Europe and some Baltic states, where annual salaries barely exceed the €20,000 mark. It is important to note that all the figures given are calculated before tax (gross).

Which countries have the highest salaries in Europe?

Iceland has firmly taken second place in the pan-European ranking after Switzerland, with an average of €85,950 per year. Rounding out the top three is Luxembourg, which holds the undisputed top spot among European Union countries with an average of €77,844. High positions are traditionally held by the countries of Northern Europe and the Benelux: in Denmark, the average salary stands at €71,961, in the Netherlands at €69,028, and in Norway at €68,420.

As for the key drivers of the European economy, Germany offers the most attractive conditions, with an average salary of €66,700. The UK is hot on its heels with a figure of €65,340. Other major players in the eurozone show significantly more modest figures. In France, the average annual salary is €45,964, in Italy €36,594, and in Spain, professionals earn an average of €32,678 per year.

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Which country has the lowest salaries in the EU?

The lowest salaries among EU countries are recorded in Slovakia, where the average annual income is €19,590. A significant number of Central and Eastern European countries fall into the category of states with average salaries below €30,000 per year.

These include Hungary (€21,257), Latvia (€21,321) and the Czech Republic (€23,685). Slightly ahead of them are Portugal, with an average of €24,254, and Poland, where workers earn around €24,490. Bringing up the rear in the list of countries with incomes below thirty thousand are Estonia (€25,603), Greece (€26,563) and Lithuania (€28,474).

Real wages in Europe

Nominal income figures do not always reflect real well-being, as purchasing power depends directly on local price levels. When salaries are adjusted for purchasing power parity (PPP), the gap between European countries narrows significantly. In this measure, annual incomes range from €38,118 in Slovakia to €106,532 in Switzerland (which retains its lead here too).

Interestingly, thanks to the relatively low cost of domestic goods and services, Turkey showed the biggest jump in the purchasing power ranking, rising from last place straight to 18th position. Germany improved its position by five places, moving from seventh to second (93,985 PPP). At the same time, countries with a high cost of living lost ground: Iceland dropped from second to ninth place, and Estonia slipped from 20th to 25th position.

Why are wages in Europe so different?

Experts from the International Labour Organisation attribute this significant income inequality to three fundamental reasons. First and foremost, labour productivity and the structure of the national economy play a huge role: countries with developed finance, high-tech and innovation sectors generate greater added value. The second factor is the strength of trade unions and the development of collective bargaining systems, which effectively protect workers’ rights. Finally, local prices and the specifics of fiscal policy have an impact. Tax rates across European countries vary drastically, so the net income remaining with employees can differ significantly from the nominal figure.

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Please note! In Germany, almost one in five residents falls into the very low-income category, whilst only a small percentage of the population earns truly high salaries. In 2026, the country’s authorities are actively discussing tax reform and new approaches to supporting the middle class. Find out more about which salaries are considered high and low in Germany and how much the country’s residents actually earn.

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