The surge in inflation following the pandemic has significantly eroded the purchasing power of Italian workers. According to an analysis by Indeed Hiring Lab, salaries advertised on Indeed lost 11.1% of their real value between January 2021 and January 2026, making Italy an outlier among major European economies.

Between 2021 and 2023, the so-called inflation shock hit most advanced economies, with consumer prices rising faster than wages. However, recovery across the eurozone has been uneven. Countries such as the Netherlands, Germany, Ireland, France, and Spain have largely regained lost purchasing power, thanks to stronger wage growth in recent years. Italy, by contrast, remains stuck behind, with its real wage index at 89.9 compared to a base of 100 in 2021.

Weak wage dynamics are a key factor. Over the past year to January 2026, advertised salaries rose by just 0.3%, while inflation stood at 1.0%, widening the gap further. Experts point to structural issues rather than weak labor demand, which remains strong and above pre-pandemic levels. Delays in renewing collective labor agreements are among the main constraints preventing wages from adjusting. Restoring real wage growth will be crucial if Italy is to recover lost purchasing power.