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Sweden has EU's highest hourly labour costs

Oliver Gee · 12 May 2014, 10:02

Published: 12 May 2014 10:02 GMT+02:00

Sweden's hourly labour costs were the highest in the EU throughout 2013, reported Germany's Federal Statistical Office (Destatis) on Monday.
 
At €43 (388 kronor) per hour, Swedish employers pay almost double the private sector average of €23.70 in the European Union (EU 27). The Euro currency area, meanwhile, has average hourly costs of €28.70.

Sweden's result marked a 1.6 percent increase compared to 2012. 
 
Susanne Spector, a labour economist at the Confederation of Swedish Enterprise (Svenskt Näringsliv), said the results were unsurprising. 
 
"I think it's no surprise we have the highest labour costs in the European Union, and of course it's problematic given Sweden's high unemployment," she told The Local. 
 
"But I think it's been like this for a long time. The most worrying part is that wages have increased more than productivity during the last few years. Firms can't continue in this way. If the wages are higher than the productivity then you can't employ workers in the long term."
 
Citing wage negotiation contracts running until 2016, Spector suspected that the trend of high labour costs will continue for "at least the next couple of years".
 
And what's worse, she said, politicians often avoid the topic completely.
 
"I think it's unfortunate that the labour costs are something most politicians never talk about. I don't think these statistics will do much to change this, either," she said.
 
"It's strange, all politicians talk about boosting employment but labour costs are a very important part of determining employment. It's worrying that the costs are increasing more than the productivity. It will dampen employment growth in the future."
 
Elsewhere in the EU, the second-highest hourly costs were in Belgium (€41.2), followed by Denmark (€39.80), Luxembourg, and France.
 
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The country with the lowest average hourly costs was Bulgaria at €3.70.
 
Sweden also ranked number one in manufacturing, with average hourly costs of €44.80.
 
The UK ranked almost exactly in the middle of the bunch at 13th, with average hourly wages in the private sector of €21.00.
 

Oliver Gee (oliver.gee@thelocal.se)

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