Romania’s hourly labour cost rises fastest in the EU in second quarter

Romania’s hourly labour cost rises fastest in the EU in second quarter
By bne IntelliNews September 14, 2018

Romania's hourly labour cost rose 15.6% y/y in the second quarter of the year, marking the highest annual increase in the EU, data from Eurostat showed on September 14.

The annual rise was supported by a number of salary hikes in the public sector and a rise in the minimum wage. However, compared to other EU member states, labour costs remain low.

Overall costs in the business economy rose 12.4% and in the mainly non-business economy by 24.6%. In the business economy, costs grew by 10.6% in the industrial sector, by 18% in construction and by 13% in services.

According to earlier data from the Romanian statistics office, the highest annual increases in April-June (working-day adjusted) were registered in information and communications (+19.1%), real estate transactions (+18.3%) and construction (+17.9%).

Across the EU, the second highest increase in the annual hourly cost was registered in Latvia (+11.7%), while in Hungary, the hourly labour cost registered the third fastest rise, of 10.2%, The lowest annual increases in hourly labour costs were recorded in Luxembourg (+0.6%), Spain (+0.7%) and the Netherlands (+0.9%).

Total labour costs cover wage and non-wage costs less subsidies. They do not include the costs of vocational training or other expenditures such as the cost of recruitment buying workwear.