Filenews 22 September 2025 - by Theano Theiopoulou
Which EU countries have the highest and lowest hourly labour costs and what differences exist between them even by sector of the economy are shown by data published by Eurostat.
In the euro area, in the second quarter of 2025 compared to the same quarter of the previous year, the cost of hourly wages and salaries increased by 3.7%, while non-wage costs increased by 3.4%.
In the EU, in the second quarter of 2025 compared to the same quarter of the previous year, the cost of hourly wages and salaries increased by 4.1%, while the non-wage component increased by 3.8%. In the second quarter of 2025, compared to the same quarter of the previous year. In Cyprus, the increase recorded is 4.2%, slightly above the Eurozone average. The feeling that exists despite the wage increases is that employees feel that the improvement in wages is not enough to meet their needs and that employers have given enough. The picture is not the same in all countries. In Germany, wage increases are accompanied by strong productivity, thanks to investments in technology and training. In Spain, the experiment of reducing the working week is accompanied by systematic monitoring of efficiency.
The largest increases in hourly payroll costs for the economy as a whole were recorded in Bulgaria (+13.4%) and Hungary (+11.0%). Three more EU Member States recorded an increase of 10% or more: Romania (+10.4%), Estonia (+10.3%) and Greece (+10.1%). The lowest increases were recorded in France (+1.4%), Denmark (+1.5%) and Malta (+1.9%). But let's see what is happening in the other countries in the second quarter of 2025 with last year's according to Eurostat data and what is the difference in hourly labour costs: Belgium 3.3%, Czech Republic 7.7%, Germany 3.8%, Ireland 3.7%, Spain 3.4%, Croatia 9%, Italy 3.4%, Latvia 8.5%, Lithuania 9.4%, Luxembourg 2.6%, Netherlands 5.9%, Austria 3.6%, Poland 9.5%, Portugal 5.3%, Slovenia 7.5%, Slovakia 9.1%, Finland 4.5%, Sweden 2.9%.
Another interesting fact is how hourly labour costs per economic activity moved. In the euro area, it increased by 3.3% in industry, 4.7% in construction and 4.3% in services. In the EU, hourly labour costs increased by 3.9% in industry, 4.8% in construction and 4.6% in services. In Cyprus, hourly costs in industry increased by 3.9% in the second quarter of 2025 compared to last year, and in the rest of the countries the following differences are recorded: Belgium 3.8%, Bulgaria 14.2%, Czech Republic 6.6%, Denmark 1.5%, Germany 2.6%, Estonia 9.9%, Ireland 2.6%, Greece 11.2%, Spain 2.8%, France 2.1%, Croatia 11.9%, Italy 3.3%, Latvia and Lithuania 9.1%, Luxembourg 1.4%, Hungary 9.4%, Malta 8.8%, Austria 3.4%, Poland 10.2%, Portugal 2.8%, Romania 12.8%, Slovenia 5.5%, Slovakia 8.8%, Finland 3%, Sweden 1.8%.
In Cyprus, hourly labour costs in the construction sector increased by 5.7% in the second quarter compared to last year. The largest increase of 16.2% in this sector is recorded in Bulgaria, followed by Romania 15%, Estonia 13.1%, Ireland 10.5%. In the services sector, the increase in hourly labour costs in Cyprus is 4.4% and the largest increase of 12.5% is recorded in Estonia.
It should be noted that the labour cost index is a short-term indicator that shows the evolution of the hourly labour cost borne by employers, in nominal terms, i.e. without adjustment for the evolution of prices. It is calculated by dividing labour costs in national currency by the number of hours worked.
