Bulgarian salaries : why should we talk about purchasing power parity ?

Bulgarian salaries

When are we going to start talking about salaries in Purchasing Power Parity instead of euros ? We are living in the era of ERASMUS, of the euro (even if some people would love to see it disappear), of the web 2.0 or even 3.0, but, there still exists many economic disparities within the European Union and the professional mobility is still very limited.  

According to some numbers of 2013, there were only 3,2% among the 500 million Europeans who tried an experience in another state of the E.U. Despite the fact that we believe that the lack of a common official language is having a huge impact on that situation, we still believe that salaries distortions are also having a huge impact on the lack of will of people to try an experience elsewhere. 

Would it not be time to use a common « currency » like the purchasing power parity when it comes to compare salaries in countries which do not stand at the same level of development ?

We are already doing it when we compare GDPs of countries which are totally different from each other so why are we not doing it when we speak about salaries ? In order to illustrate our point, we will take the example of two countries that we know very well : France and Bulgaria of course.

These two countries are totally different from an economic point of view. France is the second economical power in Europe, just behind Germany, and Bulgaria, according to the economists of Brussels, is the poorest country on the union.

The average salary in Bulgaria is around 400 euros per month. True, this sounds extremely low for a Frenchman. Despite the fact that most of the salaries are bellow 1 000 euros per month, there are still jobs which pay extremely well, especially in I.T. And we are here speaking about real local jobs from Bulgarian companies. We are not speaking about expat contract which can pay sometimes up to 10 000 euros per month with a house in Boyana, a select residential district in Sofia, and a car with a driver. So, even if these “good” jobs are still very specific to some functions and some sectors, there are many jobs in Bulgaria which pay around 800, 1 000 euros and sometimes up to 2 000 euros per month.

To be very familiar with both job markets in France and in Bulgaria, we can tell that :

the jobs which pay around 800-1 000 euros in Bulgaria, pay around 1 600-1 900 euros in France

Psychologically, it is very hard for a Frenchman to accept a cut of 50% of his salary to come work in Bulgaria even if the job offered by the Bulgarian company is really interesting and with a lot of career evolution perspectives.

That’s really a pity because the cost of life in Bulgaria is about 3 times lower than in France so even with a salary cut by half, the purchasing power is still 50% higher in Bulgaria than in France. 

By thinking in euros and in absolute value, we are certain that many Europeans from the West miss great opportunities in the East

Because we believe that the case between France and Bulgaria also exists between Belgium, Germany, the Netherlands and Romania, Poland, and Slovakia for example.

As a result, we believe that if Europe wants to encourage the professional mobility within the states, it would be necessary to develop a comparative tool which would help to compare salaries between countries which do not stand at the same level of economic development. We are already doing it when we compare GDPs so why don’t we do the same when we compare salaries?

For sure, this would contribute to break the psychological barriers by helping people compare what is comparable.

Alexandre Kolow

Entrepreneurship & Economics Editor

Alexander felt in love with Bulgaria when he came for the first time in 2003 to work for a French company. He believes that Bulgaria is like a rough diamond which has still not been cut.

2 Comments
  1. Hi!
    I am Bulgarian and I was hoping to find some information regarding the purchasing power of Bulgarians with the lowest wages – in Bulgaria. The market prices in Bulgaria do not correspond to the wages that people receive.
    It would be interesting to see these facts and comparison graphs. Good job on the comparison between France and Bulgaria, though. I would love to see a comparison between Bulgaria and Sweden. Thanks!

  2. Hello,
    I am Bulgarian, living in France for the last 5 years. The analysis looks well on paper but is far from the reality….. 1st point : the cost of living in Bulgaria is not 3 times cheaper than France. The salaries you refer for Bulgaria are maybe these ranges for some qualified jobs in Sofia but more than half of population overall and much more on the countryside are far from these ranges. What is shocking is that in France I am finding many foods (especially vegetables, meat, … on annual basis, not just seasonal) cheaper in France. Proportionally what I was paying for food, utilities bills, health care, transportation and education of my kid from my salary is much lower than what I was paying in Bulgaria. For information I was working in Bulgaria and now in France high range job in financial sector. In Bulgaria the only cheaper expense is for social entertainment like being out on bars, restaurants, night clubs and so on. Cinema tickets are often more expensive than in France !!!!! Overall there is something else hidden not obvious expense result of all the corruption (education, health care, public services, etc…) that is not seen and can’t be easily seen by a foreigner but is big part of the Bulgarian cost of living. It is offset by the grey economy income and all money paid under the table in the small and middle business but still the expense to pay due to corrupted structures is higher. In this analysis is also missing cost of living versus quality of living which is much much lower sadly for Bulgaria. First example : the health care and people dying everyday for reasons that are impossible to happen in France. Please consider the overall picture, Thanks!

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