Irish hourly labour costs fall in first quarter of 2014

Eurostat data show hourly rates contract here but rise in the rest of the euro area

Tue, Jun 17, 2014, 17:06

EOIN BURKE-KENNEDY

Hourly labour costs in Ireland fell by 0.2 per cent in the first quarter of this year, bucking a euro area-wide trend of rising wage rates, according to figures from Eurostat.

The marginal decline in Irish hourly rates contrasts with a 0.7 per cent increase recorded in the previous quarter and coincides with a major slowdown in the rate of employment growth recorded in the most recent Quarterly National Household Survey.

The two main components of labour costs are wages and salaries, and non-wage costs.

In Ireland, wages and salaries per hour worked fell by 0.3 per cent while the non-wage component decreased by1.3 per cent in the first quarter when compared with the same period in 2013.

The Eurostat figures show average hourly labour costs in the euro zone rose by 0.9 per cent in the first quarter, down from the 1.6 per cent growth recorded in the final quarter of 2013.

Wages and salaries per hour worked grew by 1.5 per cent while the non-wage component decreased by 0.8 per cent in the first quarter compared with the same quarter of the previous year.

A breakdown of the figures by economic activity showed hourly labour costs in the euro area rose by 0.7 per cent in industry, by 1.9 per cent in construction, by 1.3 per cent in services and by 0.5 per cent in the (mainly) non-business economy.

Among the European Union member states for which data are available, the highest annual increases in hourly labour costs for the whole economy were registered in Latvia (+7.0 per cent), Estonia (+6.8 per cent), Romania (+5.3 per cent) and Poland (+4.2 per cent).

Decreases were recorded in Cyprus (-6.9 per cent ), Croatia (-1.7 per cent ), Ireland (-0.2 per cent ) and Italy (-0.1 per cent ).