Lithuania is a member of the European Union and has one of the largest economies, as well as the highest GDP per capita among the Baltic States. More and more job seekers are moving to this country to take advantage of the growing economy. Despite suffering from the great recession, Lithuania’s economy recovered faster than other EU countries and has since experienced economic growth. The labor force participation rate in Lithuania has reached an all-time high of 62.20% in 2019. It’s important to understand what this wonderful country is all about before relocating. This means taking note of what the current job market is like, what employers want, and most importantly, how much they are willing to pay.
What is the average salary in Lithuania in 2020? A person working in Lithuania earns an average gross salary of $22,520/year, $1,734/month, and $9.91/hour, Salaries look even more impressive in net wage thanks to the reduced tax burden. In that case, the average monthly net salary (after tax) is $852.51. The highest salaries are found in the city of Vilnius at an average of $1,991 gross per month.
The process of getting employment in Lithuania for EU/EEA citizens is fairly simple as they have a right to work here. Non-EU/EEA citizens, on the other hand, have to obtain a work permit, which is usually arranged by an employer. Most expatriates in Lithuania tend to find employment in highly skilled positions for communications, technology, as English teachers, or in food processing companies. Having the right set of skills and good academic credits is highly valued and will secure you quality jobs with better earnings. The better skilled you are, the more employable you become. The following sections will summarise what the Lithuanian job market looks like. Without further ado, let’s get started:
Average Salary in Lithuania
If you’re looking to enter the Lithuanian job market, it’s probably best to look at the average salaries for specific job titles. Some of them are shown below:
|Profession||Average monthly salary ($)|
|Human resource manager||$2346|
In recent years, wages in Lithuania have been rising more than 8% a year. This is due to the increased transparency of wages and reduced tax burden, among other reasons. Despite this, labor costs in this country remain among the lowest in the EU.
The economy and labor force market
Traditionally, Lithuania has strong agricultural, textile, furniture, and logistics industries. But like most developed economies, its current job market is bigger in the services sector, which contributes 68% of the total GDP. This is followed by industry at 28% and agriculture at 4%. Lithuania has been transitioning from an industrial economy to a knowledge-based one, and currently focuses on high added-value products and services. This makes it one of the leading EU countries for IT, communications, biotechnology, and mechatronics as evidenced by the number of international food, pharmaceutical, and technology firms that have offices here. Some of these companies include Microsoft, Kraft Foods, Barclays, GlaxoSmithKline (GSK), Siemens, IBM, etc.
Job opportunities in Lithuania for foreigners
Lithuania houses many western companies since taxes and labor costs are well below Western European standards. As a result, employees can get transfers from their home companies to come and work here. Most employment opportunities for expatriates are in the telecommunications and IT sectors. Another option, especially for native speakers of English, is TEFL. Many online TEFL courses require a small investment of time and money, which you can take to help you land a job. Given that we live in a digital era, working online can be another option. There are several jobs you can do online; all you need is a stable internet connection.
What do employers seek in Lithuania?
Given the recent significant increase in foreign investment into FinTech, financial services, and ICT, the highest demand is for software engineers and ICT professionals. Other talents employers seek include marketing and communications, sales and business management, customer support, legal and social professional, engineers, and product management. And, as with many countries, there’s always a shortage of healthcare professionals.
The highest salaries correlate according to the demand, meaning the above talents are some of the highest paying in Lithuania.
A 40-hour workweek is standard. Overtime is pretty common through collective agreement, but a workday should not exceed 12 hours. Employees are entitled to four weeks of annual paid vacation and female employees generally get 126 days of paid maternity leave.
Lithuania Average Household Income
The annual household income per capita in Lithuania reached $6,904 in December 2018. The value was higher than the previous year’s value, which was $5,968. The country’s annual household income is updated yearly and has recorded an average of $4,936 from 2005 to 2018. The data recorded a low of $2,202 in December 2005 and reached an all-time high of $6,904 in 2018. Despite an expanding economy, wage inequality continues to worsen in Lithuania. The top 20% of the highest earners makeover seven times higher than what the 20% of the poorest residents make.
The Minimum Wage in Lithuania
Like most countries, Lithuania has a state-mandated minimum wage. Employers are required to pay their workers no less than that amount or risk being punished by the government.
The minimum wage in Lithuania rose from €400 ($440.76) per month in 2018 to €555 ($611.55) per month in 2019. That is €3.39 an hour and €6,660 per year. Note that this amount is before tax and valid till December 2019. It can be very challenging to live comfortably on this wage, especially being a foreigner. You’ll have to live in a small rural area and even then, you’ll need a second source of income to achieve any levels of comfort. Think of all the expenses you have to incur monthly: housing, transport, food, utilities, health insurance, and personal care, just to mention a few.
As for the year 2020, the minimum wage is set to increase by 9.4% to €607 ($668.85) per month. The minimum hourly wage, on the other hand, will increase by 9.7% to €3.72 ($4.10).
Lithuania’s minimum wage has experienced an overall increase of about 38.75%. It averages at €228.98/month from 1999 until 2019, recording a low of €92.14/month in 1999 and reaching an all-time high of €555 in 2019.
Increasing the minimum wage annually is an important tool to increase the income, social security, and purchasing power of the population. However, those who are not for this trend feel that it will eventually make it harder for small businesses or start-ups to afford labor costs. This will increase unemployment rates, especially among young people. It may also worsen the financial situation of some businesses and even increase the cost of living.
Given that the working time in Lithuania should not exceed 40hrs/week, the monthly wage is calculated based on a 40-hour workweek. This means that your actual wage may be smaller than the national minimum wage if you work for less than 40 hours/week.
Average Salary in Vilnius
Vilnius is the capital of Lithuania and home to the biggest tech start-up hub. It’s a fairly modern and busy city where residents enjoy a wide range of amenities, good food, favorable weather, and a relatively low cost of living. It also ranks high when it comes to ease of doing business and has several job opportunities for skilled expatriates, especially those from EU countries. If you’ve decided to build your career in Vilnius, you’re probably wondering how much you can make here.
Well, the average salary in Vilnius is approximated at $23,900 a year, $1,992/month, and $11.56 hourly. These figures represent the average gross salary, which includes basic pay and other benefits like housing and transport. In that case, the average monthly net salary will come down to about $968/month.
Salaries in Vilnius are considerably higher than the nation’s average. They have been on the rise and are slowly catching up to those in other EU capitals.
Salaries vary significantly between industries and job titles. The highest-paid workers in Vilnius are software development and IT specialists at around $30,000 a year.
Vilnius economic outlook
The economy of Vilnius heavily relies on the services and IT sector. Both of these sectors offer a good number of employment opportunities. Popular jobs for expatriates living in this city include IT, teaching, as well as science and research.
Cost Of Living in Lithuania
Lithuania may not be as cheap as countries like Thailand and Mexico, but the cost of living is still very reasonable. It’s one of the cheapest countries in Europe, meaning expats from Western and European countries will feel relieved with the prices. So, can you afford to live in Lithuania? To help you answer this, I will go through some of the expenses you’re likely to incur living in Lithuania:
Rental prices are growing quite fast in this country, especially in the major cities, but still much lower than in other EU countries. You can find a one-bedroom apartment in the center of one of the cities at an average of $440/month. For a more affordable price, consider moving outside of the city center. Buying a house is another alternative. Expect to spend around $2,285/square meter. Mortgage loans are available to expats in Lithuanian through banks and credit unions. Be sure to shop around for mortgage lenders to get the best possible deal. With housing comes utility bills, which cost around $160 for an 85m2 apartment.
Public transportation in Lithuania is well-organized and cheap. A one-way ticket costs around $1.11, while the monthly travel pass costs $32.05. If you choose to buy a car, note that fuel prices are at $1.30/litre.
Food prices are slowly rising. The good news is there’s a wide availability, allowing you to spend as much or as little as you want to. When it comes to eating out, there are all kinds of options to suit every taste and budget. A basic meal in an inexpensive restaurant costs $7.74, while a three-course meal for two in a mid-range restaurant cost $33.16. The cheapest option is street food.
In addition to these common costs, households will have to budget for several other expenses based on their needs. This includes health insurance, clothing, entertainment, tuition fees for students, as well as childcare and education costs for parents. Generally, the estimated cost of living in Lithuania for a month without rent will be $400 for a single person, $888 for a couple, and $1,150 for a couple with two kids.