The number of employees in Bucharest reached 1,093,506 in June this year, that is, 19% of the total 5,754,304 active employees in Romania worked in the capital, according to NIS and MLSP data analyzed by CursDeGuvernare. In the same month, the average wage in Bucharest was RON 6,428, 25% higher than the country’s average of RON 5,118.
However, Bucharest is Romania’s success story, perfectly integrated in Europe and not at all representative of the rest of the country.
While important national indicators remain behind EU averages, the Capital drove at full throttle and already reached the level of prosperity of many other European capitals.
GDP per capita in 2022 (based on the latest Eurostat data at region level) in Bucharest–Ilfov – having almost caught up with the European Union average – was EUR 35,200, compared to EUR 35,400. That was 2.36 times above the country’s average, which was only EUR 14,900/inhabitant.
Bucharest – Ilfov, in the Top 10 European GDP per capita in terms of PPS, well above Vienna and Berlin
The EUR 35,200/inhabitant places Bucharest-Ilfov on the 100th place among the 242 NUTS 2 regions of the EU, but in terms of GDP per capita in terms of PPS (purchasing power standard), Bucharest-Ilfov holds the 8th place in the top, calculated at purchase power parity (PPP):
NOTE:
purchasing power parity (PPP) is used to make adjustments for differing prices. In comparisons between countries, in the case of GDP per capita, the figures are not only expressed in a common currency, they are also adjusted for the differences between the prices of the products in the consumption basket – otherwise, we would have an overestimation of GDP levels in countries with high prices compared with countries that have lower price levels.
Data shows that in 2022 GDP/capita was highest in Southern Ireland, 286% of the EU average, followed by Luxembourg (257% of the EU average), Eastern and Central Ireland (247%), Prague-Czech Republic (207%) and Région de Bruxelles Capitale Belgium (196%).
According to Eurostat, „the high GDP/ capita in these regions (Luxembourg, Brussels and Prague) can be partly explained by the high influx of commuter workers and by some important multinational enterprises registered in these regions (Southern Ireland, East and Midland)”, an explanation also valid for the Bucharest-Ilfov region, with 177% of the GDP/capita of the EU in PPS.
By comparison, Vienna ranks only 24th, with a GDP/capita expressed in a PPS of 142. Berlin is 144th, with a GDP/capita in a PPS of 122.
The largest share of population earning much more than the rest of the country
The differences between the Capital and the rest of the regions reflect the huge inequalities, a chasm that also exists in the comparison between large urban areas overall and national averages.
And Romania is a unique case in Europe concerning these discrepancies.
For example, the large urban area in our country registers the highest share of people with incomes at least 60% higher than the median income (the threshold that divides the inhabitants into half of the population with incomes below this threshold and half of the population with incomes above it).
Subsequently, in 2022, 36.4% of the population in large cities in Romania had incomes that represented at least 160% of the median income of the population. The EU average stood at 20.5%.
We note that the big urban area represents „cities” from the Eurostat classification of territorial administrative units according to the degree of urbanization, where we have:
- (1) cities
- (2) towns and suburbs
- (3) rural areas
One of the largest shares of families satisfied with their financial situation
The large urban area in Romania, to the data of which the Capital contributes greatly, also records one of the highest percentages of households that declare themselves satisfied with their financial situation: 7.1% of families in this urban category. It is followed by the Netherlands, Finland and Sweden – where 7.5% and 7.3%, respectively, of large cities households are satisfied with their financial situation.
The percentage is above the EU average, of 6.6% of households in large urban areas.
The fact that life is better in large urban areas in Romanian than in large urban areas in Europe is also proven by the share of population at risk of poverty and social exclusion.
In 2022, 18.9% of the large urban population in Romania was at this risk (AROPE), while the EU average stood at 21.7%. In France and Germany, the percentage exceeded 24%.
But, the situation of the large urban area in Romania is also very far in this respect from what is happening with the national average: the share of people exposed to the risk of poverty and social exclusion was 34.4% in 2022 at national level.
In France and Germany, inequalities are much more reduced. In 2022, this indicator recorded a national average of 20.7% and 21.1% respectively.
The gap from the average in large urban areas of these countries reflects a completely different social reality – the differences depending on the degree of urbanization are much more diminished and percentages are higher in the big cities, in the metropolises that attract not only residents from other areas, but many more immigrants as well. It is the case of all metropolises.
In tangible terms, we are not doing so well
Satisfaction concerning the financial situation is a totally subjective indicator of perception, which involves comparison with others, with the many who do not earn as well as the 7.1% of households in the large urban area. However, things are not as good compared to the EU. The proof is the average consumption expenses of households expressed in terms of Purchasing Power Standard (PPS) – the average of the large urban population in the EU was 26,827 in 2022, while the average of the large Romanian urban population was only 17,920.
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