While households have been hit hard by rising prices in 2023, with inflation reaching 7% in March, businesses have also suffered from the consequences of the war in Ukraine. In addition to the increase in the price of raw materials, there is an increase in the cost of labor. Plus 5.3% on average in the European Union in just one year, according to figures from the German Federal Statistical Office Destatispublished this Sunday, April 25.
In 2023, the hourly wage cost increased across the entire Old Continent, with the exception of Sweden, where it fell by more than 3%. In France, this increase remained relatively moderate, and stood at 3.6%. In contrast to Belgium where the cost of labor has increased by 8% compared to 2022. But it is in eastern Europe that the greatest increases have been recorded. Almost a fifth more in Hungary, and almost 16% in Poland. Lithuania and Estonia reached 12.4% and 11.7% increases respectively.
The East-West gap
Note, however, that the cost of labor in the countries of the former Soviet bloc remains well below that of the European average, which amounts to 31.80 euros. In Hungary, for example, an employee costs their employer on average 12.80 euros per hour, or four times less than a Luxembourg employee. But it is Romania and Bulgaria which hold the record for the lowest labor costs: 11 euros and 9.30 euros respectively per hour. More generally, “labor costs per hour worked vary considerably within the European Union,” underlines Destatis.
A gap is observed in particular between the countries of Northern and Western Europe and those of Eastern Europe. The former appear, for example, at the top of the ranking of states where the cost of labor is the highest.
France reached 42.2 euros in 2023, neck and neck with its German neighbor, which spends on average 41.3 euros per employee and per hour worked. The Franco-German couple is thus hot on the heels of the Netherlands, where the hourly cost amounts to 43.39 euros. On the podium of the ranking, Luxembourg, Denmark, and Belgium which recorded a respective salary cost of 53.90 euros, 48.10 euros and 47.10 euros per hour worked.