In 2023, the Greek economy felt the repercussions of the COVID-19 pandemic, the wars in Ukraine and the Middle East, the increase in energy prices, persistent inflation (especially in food and services), and intense natural disasters (floods, heatwaves and fires) due to climate change. These factors added to the ongoing impacts of long-term fiscal adjustment programmes implemented by the country from 2010 until 2018.
Nevertheless, gross domestic product (GDP) increased by approximately 2.2% over the first nine months of 2023, and this positive trend is expected to continue in 2024, with a projected GDP increase of 2.7%. Simultaneously, unemployment declined to 9.6% in October 2023 compared with 11.8% in October 2022, and the minimum wage increased by 9.4% in comparison with 2022, reaching €780 from April 2023.
However, despite an unemployment rate of around 10%, there are labour shortages for both skilled and low-skilled workers, especially in sectors such as tourism and agriculture, according to the social partners, and employers particularly. One of the main reasons for these shortages is low wages in general, as well as the low minimum wage in Greece, compared with the high cost of living. The labour shortage was the reason the government legalised approximately 10,000 immigrants, who were already working in Greece.
According to various opinion polls and studies conducted in 2023 by different bodies (social partners, professional organisations and consumer associations), the positive economic performance cannot offset the serious problem of persistent price increases in goods and services. These increases have weakened the purchasing power of workers, disproportionately raised the cost of living, intensified economic inequalities, and contributed to the impoverishment of a significant portion of the population.
The inflation rate during 2022 (9.6%) was a key issue during the consultation for setting the minimum wage, with the General Confederation of Greek Workers (GSEE) demanding an increase of about 15% (from €713 to €825), while the increase proposed by employer organisations ranged from 5% to 8%. Ultimately, the government raised the minimum wage by 9.4% (from €713 to €780).
Collective agreements continue to cover a low percentage of employees (estimated at a maximum of around 30%), due to the fact that most signed collective agreements have not been declared generally mandatory for all employers. The majority of sectoral collective agreements signed during 2023 foresee wage increases compared with the previous year (13 out of 19 sectoral and professional collective agreements).
Regarding labour law in 2023, several significant changes were passed, the most important of which include the adoption of the EU Directive on transparent and predictable working conditions; the possibility of a second employer employing workers, with a total limit of 13 hours per day and 48 hours per week; the extension of the application of the digital work card to the retail trade and industry from 1 January 2024 (affecting about 100,000 companies with 600,000 employees); and the calculation and monitoring of working time based on the digital card (regular hours and overtime).
Social dialogue in Greece continues to be rudimentary in most cases, while the government continues to underutilise the opportunities it presents. This issue, combined with demographic change, technological lag, the deterioration of public services such as health and education, and housing problems, poses the greatest challenges for the future and creates widespread insecurity.
The government as well as the social partners accept that top priorities for 2024 include the need to take drastic measures to address price increases and improve the living standards of workers, as well as implementing measures to address environmental risks, promote the green economy, and invest in the technological upgrading and digitalisation of businesses and the economy.
