Six things you need to know about salaries in Switzerland
If you already live and work in Switzerland, (or are about to move here), you are probably familiar with the pay scale in various industries. But there are a few things you may not know about.
An increasing number of foreign workers have come to Switzerland in the past few years.
In 2023, for example, net immigration to Switzerland stood at nearly 100,000 people —98,851 to be exact —an increase of 17,506 people compared to 2022.
Two-thirds came from the EU and EFTA (Norway, Iceland, and Liechtenstein), attracted by job opportunities and higher wages than they would earn for the same positions in their own countries.
This brings up a question of whether Swiss wages are really higher than elsewhere in Europe, and by how much.
Yes, salaries in Switzerland are, indeed, the highest in Europe
This is what emerges from Eurostat data, which shows that, wage-wise, Switzerland tops the European list.
Specifically, it indicates that an average Swiss annual wage in 2022, taking into account inflation rates, demand, and other labour market factors, was106,839 euros (102,000 francs at today’s exchange rate).
That is a higher salary than in Iceland (81,942 euros / 78,237 francs), Luxembourg (79,903 euros / 76,273 francs), and Norway (74,506 euros / 71,143 francs).
Curiously, however, there’s a significant disparity between the Eurostat numbers and those of the Federal Statistical Office (FSO), which lists a median annual Swiss salary at 80,500 francs.
The difference likely lies in calculation methods, but whichever figure you take, the fact that Swiss wages are higher than elsewhere in Europe is undisputable.
Switzerland doesn’t have a national minimum wage
Unlike most European nations, Switzerland doesn’t have a national minimum pay.
In 2014, the country held a referendum that proposed setting the minimum wage at 22 francs an hour, but the move was rejected by 76.3 percent of voters.
They accepted the government's argument that a compulsory minimum wage would force smaller companies out of business.
However, to date, five cantons — Geneva, Basel-City, Neuchâtel, Jura, and Ticino — have introduced minimum wages on their territories.
At 24.32 francs, Geneva has the highest minimum hourly salary. (Exceptions are employees in the agriculture and floriculture sectors, who have their own minimum pay of 17.87 francs / hour).
Next is Basel-City, (21.45 francs an hour), while Neuchâtel and Jura set it at 20 francs, and Ticino at 19.75 francs.
These salaries, negotiated by unions on behalf of workers, reflect the cost of living in each of these regions, which explains why some wages are higher than others.
In 2023, Zurich residents also voted to introduce a minimum hourly wage of 23.90 per hour.
It was was supposed to come into effect from 2024, but now it will take longer for this measure to be implemented — if it will be at all — because
this move is being challenged by employers' associations.
Not everyone, however, is subject to minimum wages: most employers already pay more than the minimum mandated by law in those cantons.
READ ALSO : Where is Switzerland's highest minimum wage?
Most wages are negotiated through a collective agreement
This is a kind of contract that is negotiated between Switzerland’s trade unions and employers or employer organisations.
Aside from a minimum wage for each type of work, this agreement (CLA) also covers regulations relating to work hours; payment of wages in the event of illness or maternity; vacation and days off; and protection against dismissal.
Other important employment-related matters are also subject to negotiations — for instance, pension fund regulations, early retirement, conflict resolution procedures, and funding of training.
CLAs are sector-specific; in other words, they take into account the particular aspects of each branch. As an example, Switzerland’s largest labour union, The Swiss Federation of Trade Unions (UNIA), maintains 265 collective agreements in the areas of industry and construction.
Collective agreements can also be company-specific — for instance, Coop, Migros, or SWISS airline — or specific to a certain region.
READ ALSO : What is a Swiss collective bargaining agreement — and how could it benefit you?
Which jobs pay the most right now?
Usually, the jobs that are most in demand, or which require specialised skills, are the ones that pay the most, and where salary hikes are the highest — because companies want to retain their employees, literally at any cost.
This year, for instance, the most in-demand jobs are in IT and digital marketing, where salaries have gone up by 6 to 10 percent more over the last 12 months.
Specifically, job categories showing the highest salary increases include digital sales and marketing (+10 percent), followed by IT (+6 percent).
Sectors where wages went up by more than 5 percent over the last 12 months include Finance and Accounting, Health and Life Sciences, Procurement and Supply Chain, Property and Construction, as well as Office and Management Support.
The financial services sector is also lucrative in terms of pay.
A chief financial officer in an international company, for instance, could be paid, on average, as much as 360,000 francs a year, while the salary of a chief investment officer would be only slightly lower at 320,000 francs annually.
READ ALSO : Which sectors and jobs in Switzerland are seeing the biggest salary hikes?
Do Swiss salaries compensate for the high cost of living?
The answer to this question depends, logically, on how high your wages are versus your fixed costs (rent / mortgage, health insurance premiums, food, transport, clothing, taxes, etc.), and also your overall spending habits on “non-essentials” such as entertainment, restaurants, travel, and leisure activities in general.
That, of course, applies to all countries, not just Switzerland.
One way to look at the salaries versus the cost of living is through the purchasing power parity (PPP) — the financial ability of a person or a household to buy products and services with their wages.
An indepth analysis by a digital employment platform Glassdoor provides some interesting and no doubt surprising insights into Switzerland’s PPP in comparison with other nations.
"Taking not only income and cost of living into account, but also the effects of differences in taxation, it is possible to derive an indication of after-tax, local purchasing-power-based, standard of living”, the study reported.
“On this basis, the highest overall standard of living is found in the cities of Switzerland, Denmark, and Germany. Although the cost of living can be relatively high in these countries, so are average wages and purchasing power.”
The study concluded that “in Switzerland, Denmark, and Germany the average city-based worker can afford to buy 60 percent or more goods and services with his or her salary than residents of New York."
Also, if you look at the ‘big picture’ — taking various factors into account — the cost-of-living situation is not as bad as many people believe.
“Various factors” in this context means the low inflation rate (in comparison with other countries), high employment, and a strong economy — all of which mean that Switzerland is outperforming other European nations on many fronts.
All this goes to say that if you analyse things from a different angle, Switzerland’s cost of living doesn’t look so bad.
READ ALSO : Why Switzerland's cost of living isn't as high as you think
How can you know if you are being fairly paid?
Wage dumping is not a widespread practice in Switzerland, and is predominantly limited to small companies that subcontract work.
The country has strong labour laws which protect workers in terms of wages, work conditions, and other employment-related rights.
If you are not represented by a union and your job is not covered by a CLA, and you want to know what a standard wage is for your type of job and industry, you can do so by checking out the wage calculator created by UNIA trade union.
It is programmed with the latest salary levels from 72 different industry sectors and 36,000 companies in Switzerland, so it will give you a good indication of what a fair wage is in your case.
If the pay your employer is offering you is below the industry standard, you have the option of not accepting the job. In case you are already
working and realise your employer is short-changing you — especially based on your nationality, race, gender or disability — there are some options open to you, all of which are outlined on this government site.
If a court or another official body decides the employer was paying you unfairly, the company will have to repay the wage difference.
READ ALSO : How can I find out if my Swiss employer is underpaying me?
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An increasing number of foreign workers have come to Switzerland in the past few years.
In 2023, for example, net immigration to Switzerland stood at nearly 100,000 people —98,851 to be exact —an increase of 17,506 people compared to 2022.
Two-thirds came from the EU and EFTA (Norway, Iceland, and Liechtenstein), attracted by job opportunities and higher wages than they would earn for the same positions in their own countries.
This brings up a question of whether Swiss wages are really higher than elsewhere in Europe, and by how much.
Yes, salaries in Switzerland are, indeed, the highest in Europe
This is what emerges from Eurostat data, which shows that, wage-wise, Switzerland tops the European list.
Specifically, it indicates that an average Swiss annual wage in 2022, taking into account inflation rates, demand, and other labour market factors, was106,839 euros (102,000 francs at today’s exchange rate).
That is a higher salary than in Iceland (81,942 euros / 78,237 francs), Luxembourg (79,903 euros / 76,273 francs), and Norway (74,506 euros / 71,143 francs).
Curiously, however, there’s a significant disparity between the Eurostat numbers and those of the Federal Statistical Office (FSO), which lists a median annual Swiss salary at 80,500 francs.
The difference likely lies in calculation methods, but whichever figure you take, the fact that Swiss wages are higher than elsewhere in Europe is undisputable.
Switzerland doesn’t have a national minimum wage
Unlike most European nations, Switzerland doesn’t have a national minimum pay.
In 2014, the country held a referendum that proposed setting the minimum wage at 22 francs an hour, but the move was rejected by 76.3 percent of voters.
They accepted the government's argument that a compulsory minimum wage would force smaller companies out of business.
However, to date, five cantons — Geneva, Basel-City, Neuchâtel, Jura, and Ticino — have introduced minimum wages on their territories.
At 24.32 francs, Geneva has the highest minimum hourly salary. (Exceptions are employees in the agriculture and floriculture sectors, who have their own minimum pay of 17.87 francs / hour).
Next is Basel-City, (21.45 francs an hour), while Neuchâtel and Jura set it at 20 francs, and Ticino at 19.75 francs.
These salaries, negotiated by unions on behalf of workers, reflect the cost of living in each of these regions, which explains why some wages are higher than others.
In 2023, Zurich residents also voted to introduce a minimum hourly wage of 23.90 per hour.
It was was supposed to come into effect from 2024, but now it will take longer for this measure to be implemented — if it will be at all — because
this move is being challenged by employers' associations.
Not everyone, however, is subject to minimum wages: most employers already pay more than the minimum mandated by law in those cantons.
READ ALSO : Where is Switzerland's highest minimum wage?
Most wages are negotiated through a collective agreement
This is a kind of contract that is negotiated between Switzerland’s trade unions and employers or employer organisations.
Aside from a minimum wage for each type of work, this agreement (CLA) also covers regulations relating to work hours; payment of wages in the event of illness or maternity; vacation and days off; and protection against dismissal.
Other important employment-related matters are also subject to negotiations — for instance, pension fund regulations, early retirement, conflict resolution procedures, and funding of training.
CLAs are sector-specific; in other words, they take into account the particular aspects of each branch. As an example, Switzerland’s largest labour union, The Swiss Federation of Trade Unions (UNIA), maintains 265 collective agreements in the areas of industry and construction.
Collective agreements can also be company-specific — for instance, Coop, Migros, or SWISS airline — or specific to a certain region.
READ ALSO : What is a Swiss collective bargaining agreement — and how could it benefit you?
Which jobs pay the most right now?
Usually, the jobs that are most in demand, or which require specialised skills, are the ones that pay the most, and where salary hikes are the highest — because companies want to retain their employees, literally at any cost.
This year, for instance, the most in-demand jobs are in IT and digital marketing, where salaries have gone up by 6 to 10 percent more over the last 12 months.
Specifically, job categories showing the highest salary increases include digital sales and marketing (+10 percent), followed by IT (+6 percent).
Sectors where wages went up by more than 5 percent over the last 12 months include Finance and Accounting, Health and Life Sciences, Procurement and Supply Chain, Property and Construction, as well as Office and Management Support.
The financial services sector is also lucrative in terms of pay.
A chief financial officer in an international company, for instance, could be paid, on average, as much as 360,000 francs a year, while the salary of a chief investment officer would be only slightly lower at 320,000 francs annually.
READ ALSO : Which sectors and jobs in Switzerland are seeing the biggest salary hikes?
Do Swiss salaries compensate for the high cost of living?
The answer to this question depends, logically, on how high your wages are versus your fixed costs (rent / mortgage, health insurance premiums, food, transport, clothing, taxes, etc.), and also your overall spending habits on “non-essentials” such as entertainment, restaurants, travel, and leisure activities in general.
That, of course, applies to all countries, not just Switzerland.
One way to look at the salaries versus the cost of living is through the purchasing power parity (PPP) — the financial ability of a person or a household to buy products and services with their wages.
An indepth analysis by a digital employment platform Glassdoor provides some interesting and no doubt surprising insights into Switzerland’s PPP in comparison with other nations.
"Taking not only income and cost of living into account, but also the effects of differences in taxation, it is possible to derive an indication of after-tax, local purchasing-power-based, standard of living”, the study reported.
“On this basis, the highest overall standard of living is found in the cities of Switzerland, Denmark, and Germany. Although the cost of living can be relatively high in these countries, so are average wages and purchasing power.”
The study concluded that “in Switzerland, Denmark, and Germany the average city-based worker can afford to buy 60 percent or more goods and services with his or her salary than residents of New York."
Also, if you look at the ‘big picture’ — taking various factors into account — the cost-of-living situation is not as bad as many people believe.
“Various factors” in this context means the low inflation rate (in comparison with other countries), high employment, and a strong economy — all of which mean that Switzerland is outperforming other European nations on many fronts.
All this goes to say that if you analyse things from a different angle, Switzerland’s cost of living doesn’t look so bad.
READ ALSO : Why Switzerland's cost of living isn't as high as you think
How can you know if you are being fairly paid?
Wage dumping is not a widespread practice in Switzerland, and is predominantly limited to small companies that subcontract work.
The country has strong labour laws which protect workers in terms of wages, work conditions, and other employment-related rights.
If you are not represented by a union and your job is not covered by a CLA, and you want to know what a standard wage is for your type of job and industry, you can do so by checking out the wage calculator created by UNIA trade union.
It is programmed with the latest salary levels from 72 different industry sectors and 36,000 companies in Switzerland, so it will give you a good indication of what a fair wage is in your case.
If the pay your employer is offering you is below the industry standard, you have the option of not accepting the job. In case you are already
working and realise your employer is short-changing you — especially based on your nationality, race, gender or disability — there are some options open to you, all of which are outlined on this government site.
If a court or another official body decides the employer was paying you unfairly, the company will have to repay the wage difference.
READ ALSO : How can I find out if my Swiss employer is underpaying me?
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