Despite a slowdown in new job creation, the employment rate and labor force shortages are at historically high levels in Greece. This has led to rising real wages and a robust tourism industry that is boosting consumption. Inflation is expected to continue declining, albeit at a slower pace, with a forecasted easing to 2.1% in the last quarter of 2025.
The Greek economy is projected to continue growing at a steady pace, with a projected growth rate of 2% in 2024 and 2.5% in 2025. Wage growth reached 5.5% in the fourth quarter of 2023, with the minimum wage also seeing significant increases in April 2023 and April 2024. The absorption of Recovery and Resilience Fund resources, along with improvements in bank stability, will support investment, despite tight financial conditions. Investment is forecasted to grow by 9% in 2025.
The OECD highlights the need for Greece to address challenges such as strengthening productivity and implementing fiscal adjustments to reduce high debt levels. To sustainably reduce debt while investing in key areas like infrastructure, responding to demographic shifts, and addressing climate change, Greece will require sustained and strong economic growth. Increasing productivity levels, which currently lag behind OECD averages, will create more fiscal space and improve living standards.