The average net salary in the Federation of Bosnia and Herzegovina increased by more than 80 percent in six years, but many citizens believe that this growth did not bring a better standard of living. The reason is the continuous increase in the prices of food, energy, housing and other living expenses, which has significantly reduced purchasing power.
According to data from the Federal Bureau of Statistics, the average net salary in April 2026 was 1,706 KM, while in the same period in 2020 it was 940 KM. This represents a nominal growth of 766 KM, i.e. more than 81 percent.
Although these figures seem encouraging at first glance, economists warn that wage growth must be viewed alongside inflation, which has significantly increased the cost of living in recent years.
Especially since 2022, there has been a large increase in the price of food, fuel, electricity and other basic products, which is why the real value of wages is lower than the statistics show.
Citizens point out that the difference is felt most during everyday shopping.
“My salary is higher than a few years ago, but today for the same money I can buy significantly less than before,” says one of the employees in the private sector.
Pensioners share a similar opinion, stating that the increase in the prices of medicines, utilities and food products often exceeds the increase in their income.
Economists state that the increase in wages was influenced by the increase in the minimum wage, labor shortage, income growth in certain economic sectors and inflationary pressures. However, they warn that the standard of living of citizens will depend on whether incomes will grow faster than prices in the future.
An additional problem is the fact that the average salary does not reflect the actual situation on the labor market. A large number of employees in the trade, catering and service industries continue to receive significantly less than the average, while the increase in rents, utility costs and credit obligations puts an additional burden on household budgets.
That is why, despite record salaries on paper, many citizens believe that reaching the former standard of living is still one of the biggest economic challenges in the Federation of Bosnia and Herzegovina, reports Black Chronicle.
