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Europe – Employers pay higher labour costs

15 March 2013

Hourly labour costs continued to rise across Europe in the fourth quarter with the EU posting a +1.3% annual rise, the Eurostat statistics office reports today. In the Euro countries, labour costs also rose by +1.3%. 

Labour costs are mainly made up of wages and salaries, and so-called non-wage costs which include employers’ social contributions and certain employment taxes.

In the Euro area, employers paid more for wages and salaries, which grew by +1.4% in the quarter. The non-wage component also increased by +1.0% in the region. In the EU, wage and salary costs rose by +1.4% with the non-wage component rising by +1.2%.  

The data shows that hourly labour costs grew by +2.6% in industry, +1.2% in construction and +2.0% in the services sector.

The highest annual increase in costs was registered in Romania (+7.6%) and Estonia (+6.7%). The smallest were seen in Cyprus and Malta (both +0.5%) and Italy (+0.6%). Decreases were recorded in Spain (-3.4%) and Slovenia (-2.1%).

In the UK, labour costs fell by -0.5% in the fourth quarter – wage costs per hour worked decreased by -0.8%, while non-wage costs rose by +1.5%. Public sector labour costs fell by -4.5% and increased by +0.3% in the private sector. 

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