Distribution of Wages in the Regions of the Czech Republic

Abstract

Regions as higher territorial self-governing units were established in the Czech Republic on the basis of Constitutional Act No. 347/1997 Coll. Their territory was delimited by the territory of the listed districts. The regions show various differences in social, demographic, but naturally also economic development. The aim of the text is to evaluate the development of wages in the regions of the Czech Republic (except Prague), covering the period of 2011–2018. Wages in all regions were growing in these years, but this growth was not uniform: the lowest wages (the 1st decile wages) were growing most, the highest wages (the 9th decile wages) showed the lowest growth. Four groups (clusters) of regions were identified by the cluster analysis according to the typical development of the lowest and the highest wages. In these groups, we focused on typical factors of the wage level formation: the economic level (measured as GDP per capita), the unemployment rate and the educational level (the share of the population with basic and university education). The results of the correlation analysis showed a moderate direct relationship between the economic level and the 9th decile wages, a moderate to strong indirect dependence between the low wages of the 1st decile and the unemployment rate, but the results of the correlation analysis between the variables the educational level and wages were not very conclusive.

Regions as higher territorial self-governing units were established in the Czech Republic on the basis of Constitutional Act No. 347/1997 Coll. Their territory was delimited by the territory of the listed districts. The regions show various differences in social, demographic, but naturally also economic development. The aim of the text is to evaluate the development of wages in the regions of the Czech Republic (except Prague), covering the period of 2011–2018. Wages in all regions were growing in these years, but this growth was not uniform: the lowest wages (the 1st decile wages) were growing most, the highest wages (the 9th decile wages) showed the lowest growth. Four groups (clusters) of regions were identified by the cluster analysis according to the typical development of the lowest and the highest wages. In these groups, we focused on typical factors of the wage level formation: the economic level (measured as GDP per capita), the unemployment rate and the educational level (the share of the population with basic and university education). The results of the correlation analysis showed a moderate direct relationship between the economic level and the 9th decile wages, a moderate to strong indirect dependence between the low wages of the 1st decile and the unemployment rate, but the results of the correlation analysis between the variables the educational level and wages were not very conclusive.