Libya's public finances have entered a more sensitive phase, with increasing demands for higher salaries in vital sectors such as oil, education, and healthcare, coinciding with rising living costs and declining purchasing power. The country's latest data from the Central Bank of Libya shows that spending on salaries, recorded in the first chapter of the budget, reached approximately 46.9 billion dinars from January to August 2026, excluding August salaries. This figure does not include salaries for August.
The surge in Libya's wage bill has raised concerns about the sustainability of the country's public finances. At the end of 2025, the total wage bill was around 73.3 billion dinars, according to the Central Bank. The issue is not just the value of salaries but also the structure of the wage system, with multiple salary scales, allowances, and differences, and an expanding base of public sector workers. The Libyan economy, heavily reliant on the oil sector, struggles to provide stable revenue streams to match current commitments.
The education sector has seen significant movements, with teachers in several areas staging protests and sit-ins, demanding not only salary increases but also payment of differences and dues, settlement of job grades, and provision of health insurance. The situation in the healthcare sector is similar, with the union of healthcare workers and several syndicates calling for higher salaries, a hazard allowance, and health insurance, as well as settlement of job grades and payment of dues.
A government employee in Tripoli noted that a salary increase has become a necessity due to rising living costs but warned that such an increase could lose some of its impact if it leads to a new wave of price hikes. The employee emphasized that the real issue is purchasing power, as the benchmark is not just the salary figure but the volume of goods and services that this income can buy.
Workers outside the government apparatus offer a different perspective, arguing that improving salaries should not be limited to government employees. A citizen working in the private sector noted that any increase may help government employees for a limited period but will not achieve sustainable improvement if not accompanied by price control, exchange rate management, and service improvement.
The Central Bank of Libya's data provides a clear picture of the state's financial commitment, with spending on salaries reaching 46.9 billion dinars during the first eight months of 2026. The total expenditure during the same period was around 68.6 billion dinars, while development spending was approximately 912.8 million dinars. These figures become more significant when compared to previous years, with the wage bill being 73.3 billion dinars in 2025 and 67.6 billion dinars in 2024.
The Libyan Central Bank reported that around 1.75 million public sector employees' data were registered in the "Ratkek Hathzi" project as of August 2026, compared to 2.2 million employees previously, with a participation rate of 79%. This data highlights the importance of streamlining the employee database before making broad salary decisions, particularly with ongoing efforts to match banking and administrative data for employees.
Key points
- Libya's wage bill has surged to 46.9 billion dinars in the first eight months of 2026.
- The country's public finances face growing pressure amid rising living costs and declining purchasing power.
- The structure of Libya's wage system and its reliance on the oil sector pose significant challenges to financial sustainability.
