Key points:

  • Wage growth across Europe is gaining momentum. In July, our Wage Tracker recorded a 3.3% year-over-year increase in salaries advertised for Euro Area job postings on Indeed.
  • As of July, Indeed’s data shows wage growth again outpacing – or at least keeping pace with – inflation across the broader Euro Area.

See our full European Labour Market Overview chartbook for a more comprehensive view of the European labour market. 

Wage growth across Europe is gaining momentum. In July, our Wage Tracker recorded a 3.3% year-over-year increase in salaries advertised for Euro Area job postings on Indeed. This marks the fastest annual growth rate for posted wages since November 2024 and a sharp acceleration from the 2.5% average seen throughout the first half of the year. The recent turn upward is notable across the continent’s major economies: since spring, the three-month average of annual wage growth has climbed in Germany (3.3% as of July), France (1.7%), Spain (3.7%), and Italy (2.9%).

Line chart titled “European wage growth is accelerating” shows year-over-year percent change in wages and salaries advertised in job postings on Indeed as a 3-month moving average from 2021 to July 2026. Areas shown include Canada, the Euro Area, United Kingdom, and United States. Most regions show continued wage growth deceleration or stabilisation, but the Euro Area has seen a recent upturn. 
Line chart titled “European wage growth is accelerating” shows year-over-year percent change in wages and salaries advertised in job postings on Indeed as a 3-month moving average from 2021 to July 2026. Areas shown include Canada, the Euro Area, United Kingdom, and United States. Most regions show continued wage growth deceleration or stabilisation, but the Euro Area has seen a recent upturn. 

For many workers whose purchasing power eroded as inflation surged earlier this year, these wage increases offer welcome relief. As of July, Indeed’s data shows wage growth again outpacing – or at least keeping pace with – inflation across the broader Euro Area. Still, workers in many countries have not yet seen cumulative wage gains catch up with the price pressures of the past five years, despite the acceleration in wage growth over the past few months. With recent wage growth still clawing back lost purchasing power and job postings remaining low relative to historical levels, monetary policymakers may be less concerned about the threat of a wage-price spiral. 

Panel line chart titled “Inflation no longer outpaces posted wage growth in Euro Area” showing year-over-year percent change in headline inflation and in posted wages (smoothed via a 3-month moving average) on Indeed from February 2020 to July 2026. The Euro Area, Germany, Ireland, and the United Kingdom show real wage gains, while wage growth has fallen below price growth in France. In Italy, both inflation and wage growth are 2.9% as of July.
Panel line chart titled “Inflation no longer outpaces posted wage growth in Euro Area” showing year-over-year percent change in headline inflation and in posted wages (smoothed via a 3-month moving average) on Indeed from February 2020 to July 2026. The Euro Area, Germany, Ireland, and the United Kingdom show real wage gains, while wage growth has fallen below price growth in France. In Italy, both inflation and wage growth are 2.9% as of July.

Regardless, monetary policymakers at the European Central Bank (ECB) will be closely monitoring the upturn in wage growth. With another interest rate hike likely in September, the ECB is already hyper-focused on inflation risks, and the central bank will not take lightly the risk that wage increases are “second-order” price effects that can then place broader inflationary pressure across the economy. Even so, it would be premature to conclude that recent wage growth will translate into demand-driven inflation, given the ongoing weakness in overall labour market conditions.

See our full European Labour Market Overview chartbook for a more comprehensive view of the European labour market. Other data, including the Indeed Wage Tracker, is regularly updated and can be accessed on our data portal.