Labour costs growing fast in Malta – up by more than 11% where Malta has clearly a skills’ shortage
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Labour costs in Malta appear to be consistently on the rise with increases ranging from 1.1 per cent quarter to quarter up to an impressive 11% in certain sectors such as non-wage costs. Malta was well above the average for wage cost rises at just under 3% or in 11th place where nominal labour hourly costs were concerned.
Hourly labour costs rose by 1.7% in both the euro area (EA19) and the EU28 in the first quarter of 2016, compared with the same quarter of the previous year. In the fourth quarter of 2015, hourly labour costs increased by 1.3% and 2.0% respectively.
The two main components of labour costs are wages & salaries and non-wage costs. In the euro area, wages & salaries per hour worked grew by 1.8% and the non-wage component by 1.5%, in the first quarter of 2016 compared with the same quarter of the previous year. In the fourth quarter of 2015, the annual changes were +1.5% and +0.7% respectively. In the EU28, hourly wages & salaries rose by 1.7% and the non-wage component by 1.6% for the first quarter of 2016. In the fourth quarter of 2015, annual changes were +2.1% and +1.3% respectively.
Breakdown by economic activity
In the first quarter of 2016 compared with the same quarter of the previous year, hourly labour costs in the euro area rose by 2.0% in industry, by 1.4% in construction, by 1.7% in services and by 1.6% in the (mainly) non-business economy. In the EU28, labour costs per hour grew by 1.9% in industry, by 2.6% in construction, by 1.6% in services and by 1.5% in the (mainly) non-business economy.
In the first quarter of 2016, the highest annual increases in hourly labour costs for the whole economy were registered in Romania (+10.4%), Bulgaria (+7.7%), Estonia (+6.9%), Lithuania (+6.1%) and Latvia(+4.7%). Decreases were recorded in Italy (-1.5%) and Cyprus (-0.3%).