Italian workers’ purchasing power at the end of 2025 remains 8.6% lower than it was in January 2019, according to the 34th Annual Report released by Italy’s national statistics institute, Istat.
The report shows that inflation has risen by 23% over the past six years, while wages increased by only 13.2%, creating a significant gap between salaries and living costs.
The sharpest decline occurred between 2022 and 2023, when soaring prices severely eroded real wages. Since late 2023, however, the situation has gradually improved thanks to renewed labor agreements and inflation stabilizing below 2%. In 2025, contractual wages rose by 3.1%, outpacing inflation, which stood at 1.6%.
The impact varies widely across sectors. Industry has limited losses relatively well, while private services and public administration still show declines of more than 10% in real wages compared to 2019.
Italy also compares poorly with several European partners. Real wages remain 3.5% below pre-pandemic levels, while Germany and Spain have already returned to growth. According to Istat, new energy price pressures linked to tensions in the Middle East could once again threaten the fragile recovery in 2026.