Cyprus state sector pays much better

In a recent report released by the International Monetary Fund, the gap between salaries in the public and private sectors in Cyprus has been laid bare; public sector wages are 27% higher, with the discrepancy reaching 32% among those with higher education qualifications. But when factoring in age, the difference balloons to 50% for employees over 50 years old.

The report, published last Friday, reflects data gathered in November 2024 and paints a picture of a public sector that the IMF considers well-compensated compared to private industry standards, especially when compared to salaries in other European Union nations.

Even so, the IMF emphasized that while the public sector is “medium-sized,” it faces an ongoing need for fiscal adjustments. The global financial body has called on Nicosia to curb future pay increases for civil servants in order to free up space for other essential fiscal policies.

To balance the country’s budget, the IMF has offered a range of suggestions, such as eliminating non-critical posts, suspending or reducing the annual cost-of-living adjustment, cutting overtime, and abolishing the holiday bonus.