People who work 40 hours a week at the monthly minimum wage of LL675,000 and are paid in lira must work 1 hour and 4 minutes to buy a large package of bread from a bakery. (Credit: Mahmoud Zayyat/AFP)
.تجدون أداة حساب تكلفة المعيشة باللغة العربية في آخر المقالة
For almost two years, Lebanon has been a country with three currencies — the lira, the US dollar and the so-called lollar.
Officially at least, the lira has been pegged to the dollar at a rate of about LL1,500 since 1997. But at the economic crisis’ onset, in summer 2019, the US dollar supply began growing scarcer, and the lira’s value began slipping.
Increasingly insolvent commercial banks introduced informal capital controls that first limited and then cut off access to dollar deposits. Clients could access only a portion of their US dollars trapped in the banks, which came to be known as lollars, in lira at a significantly depreciated rate. Since April 2020 that rate has been fixed at LL3,900, only about a quarter of the dollar’s current market value.
As the lira’s value has continued plummeting, whether employees earn an income in lira, lollars or so-called fresh US dollars has a massive impact on their purchasing power.
The protracted economic crisis has been devastating for workers in Lebanon, with the Euro-Med Human Rights Monitor estimating the unemployment rate to be 37 percent as of August 2021. Of those who are employed, the vast majority of Lebanese workers — including 95 percent of public sector workers — earn salaries and wages exclusively in lira. Lebanon has experienced months of triple-digit inflation, with the prices of basic goods doubling, tripling or even quadrupling for all consumers.
But a segment of the working population, including Lebanese and foreigners working for multinational companies and international aid agencies, receives some or all of their paycheck in lollars or fresh dollars, significantly boosting their purchasing power in Lebanon’s highly unequal economy.
One tool economists use to illustrate the relative purchasing power of wages is comparing how many minutes or hours different people must work to be able to buy the same product.
L’Orient Today has calculated the amount of time workers earning different salaries or wages must clock to be able to buy various everyday products in Lebanon, and the results help demonstrate the severity of the cost of living crisis for lira earners, and the stark inequality between lira earners and dollar earners.
For example, people who work 40 hours a week at the monthly minimum wage of LL675,000, which has not changed since the crisis’ onset, and earn their salaries in lira must work 1 hour and 4 minutes to buy a large package of bread from a bakery, even though the state controls its price — most recently set at LL4,500 — ostensibly to keep it affordable. A kilogram of ground beef would require 23 hours and 42 minutes of labor. Twenty liters of gasoline would take more than a week’s worth of wages — 47 hours and 59 minutes. Before the crisis the minimum wage was equivalent to $450. Its present dollar value is just $41.
A worker in Lebanon earning LL75,000 a day, more than double the minimum wage, must work more than 1 hour and 16 minutes to buy a 2.25-liter bottle of Pepsi. That’s nearly triple the 27.3 minutes the average Egyptian worker must work to buy the same amount, and many times greater than the 4.3 working minutes required of the average American or the 3.6 minutes required of the average German.
To find out how many hours you need to work to buy a Pepsi or pack of bread, enter the total number of hours you work per week in the calculator below, as well as how much you are paid each month in each currency. Or try other salary combinations to find out how long others need to work to buy the same products. Prices and exchange rates are current as of Sept. 26, 2021, and will be updated periodically.
Cost of Living Calculator
أداة حساب تكلفة المعيشة
