The Euro-Area Countries Where Rising Pay Is the Problem

As the euro area struggles with low pay growth, hindering its drive to regain price stability, the northeast corner of the currency bloc is facing the opposite problem.

Wage growth in Estonia, Latvia and Lithuania is near its highest since the last boom-bust cycle a decade ago, outstripping efficiency gains. Nominal unit labor costs have jumped more in the Baltic nations than anywhere else in the European Union during the past three years, according to recent data from the European Commission.