Where labour costs the most (and least) in the European Union

Thyssen 2019_

Visit by Marianne Thyssen, Member of the EC in charge of Employment, Social Affairs, Skills and Labour Mobility, to Sibiu. (European Union, 2019)

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: David Knowles, Digital Media Specialist, World Economic Forum

The difference between the European Union’s most costly labour and its cheapest might surprise you.

At more than 38 euros, or $42, the spread is fairly wide, bookmarked at one end by Bulgaria, where workers cost 5.4 euros per hour, or around $6, and at the other by Denmark, at 43.5 euros, or nearly $49 dollars.

Image: Eurostat

Labour costs are an important tool for understanding the relationship between work and the economy and can give an indication of the relative cost of doing business in various locations. They may also be set to change as Globalization 4.0 advances and technology revolutionizes the workplace and the roles available.

The Eurostat data showed that in 2018, average hourly labour costs – wages, salaries, bonuses together with non-wage costs of employment – in the European Union were 27.4 euros, or almost $31, and 30.6 euros ($34) in the euro area.

Other nations with low rates were Romania, Lithuania and Latvia, while those at the high end included Luxembourg, Belgium, Sweden and the Netherlands.

Non-wage costs, including employers’ social contributions and employment taxes, also varied. The share of non-wage costs was 24% in the EU and ranged from 6% in Malta to 33% in France.

Are US workers cheaper to employ?

Image: US Bureau of Labor Statistics

Separate data from the US Bureau of Labor Statistics shows compensation costs among private industry employers averaged $34 per hour worked in December 2018. Wages and salaries made up 70% of these costs, while benefits accounted for the rest.

This data also showed regional differences – with the north-east being the most costly and the south the cheapest.

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  1. Victor says:

    Labor or worker total cost should be considered in the ratio of worker total cost/ Total Market business cost. If the law and regulations are the most simplifid and best possible, it’s the best option.

    EU can take the reform of most simplified qualifications to form least qualifications in the form of e-qualification required by EU or constitutional law within EU via EU E-qualification E-platform. Some of the e-qualifications can be memberships of lawful EU societies or associations, and no other qualified certificates will be requested for positions funded by EU budgets except for necessary requirement of the EU e-qualifications.

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