This news release presents the findings of the 2020 Labour Cost Survey (LCS). The LCS is an enterprise-based survey carried out every four years designed to gather information on the costs borne by employers (10+ employees) in order to employ staff. Given that the reference period is the year 2020, data in this news release should be interpreted in the context of the COVID-19 pandemic. During the reference period, an estimated 237,111 employees within the survey’s target population accounted for a total labour cost of €5.5 billion, with an average cost per enterprise of €1.6 million (Table 3).
The average hourly labour cost excluding apprentices was €13.54. This includes outlay on wages and salaries, social contributions, vocational training and other labour-related expenses, such as the cost of uniforms or protective clothing. The lowest hourly labour cost was recorded for the wholesale and retail trade, transportation and storage, accommodation and food service activities sector (€9.25) (Chart 1). The hourly labour cost for enterprises with more than 250 employees was €14.49 compared to €13.77 for enterprises with 10 to 49 employees.
The financial and insurance activities sector had the highest annual average labour costs per employee (€40,568), followed by the information and communication sector (€35,153). Enterprises operating within wholesale and retail trade, transportation and storage, accommodation and food service activities recorded the lowest annual average labour costs per employee (€17,039) (Table 2).
Chart 1. Average labour costs per hour by economic activity of enterprise
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Note: Data excludes apprentices.
Chart 2. Main components of labour cost
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Note: Other includes vocational training costs (0.5%) and other expenditures paid by the employer (0.4%).
Wages and salaries
Wages and salaries accounted for the largest portion of total labour costs, with a share of 92.2 per cent. These were followed by employers’ social contributions, at 6.9 per cent. Vocational training costs and other expenditures paid by the employer made up the remaining 0.5 per cent and 0.4 per cent of the total labour cost, respectively (Chart 2, Table 4).
The total sum of wages and salaries paid by employers to all employees excluding apprentices amounted to €5.4 billion, with the average amount paid per enterprise being €1.6 million. The basic salary constituted the highest proportion of the wages and salaries, covering 84.9 per cent of total wages. Regular bonuses and allowances accounted for 6.0 per cent of wages and salaries, followed by irregular bonuses and allowances, at 5.4 per cent. The smallest proportion of wages and salaries was spent on fringe benefits, which in 2020 constituted just 0.9 per cent of the total employer wage bill (Chart 3, Table 5). At 91.0 per cent, the basic salary as a proportion of the total resulted to be highest in arts, entertainment and recreation and other service activities (Table 6).
Chart 3. Breakdown of wages and salaries
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Note: Data excludes apprentices.
Average compensation of employees per capita
The findings indicated that the average compensation of employees per capita was directly proportional to the size of enterprise. Indeed, the compensation of employees averaged €22,842 for small enterprises (10-49 employees), €23,598 for medium-sized enterprises (50-249 employees) and €26,319 for large enterprises (250+ employees). Employees working in financial and insurance activities received the highest compensation, with an average of €39,727 per capita. Contrarily, the lowest average compensation was recorded for employees working in wholesale and retail trade, transportation and storage and accommodation and food service activities (€18,618) (Table 7).
Vocational training costs and other labour cost expenditure
Total vocational training costs for economic activities covered by this survey nearly reached €31 million, where 57.7 per cent of these costs were incurred by enterprises with 250 or more employees. The largest vocational training costs were spent by employers operating in the professional, scientific, technical, administration and support service activities, corresponding to 27.4 per cent of the total (Table 8). Other expenditures, comprising payments for uniforms and protective clothing provided to employees and recruitment costs, such as expenditure on job advertisements in different media, were highest in public administration, defence, education, human health, and social work activities (24.3 per cent), followed by professional, scientific, technical, administration and support service activities (19.8 per cent). In contrast, the real estate sector had the lowest other expenditures (0.5 per cent). Other expenditures paid by the employer, like vocational training costs, were higher for larger enterprises (44.7 per cent) when compared to both medium (33.0 per cent) and small-sized (22.3 per cent) enterprises (Table 9).
Subsidies on direct remuneration
Data on subsidies on direct remuneration received by employers in 2020, indicates that SMEs (small and medium-sized enterprises) received the majority of the subsidies, with 75.6 per cent of the total amount being given to enterprises with 249 or fewer employees. In terms of economic activity, wholesale and retail trade, transportation and storage and accommodation and food service activities received the most subsidies, garnering 48.9 per cent of the total subsidy outlay. At 0.4 per cent, the real estate activities sector received the least amount (Chart 4, Table 10).
Chart 4. Subsidies on direct remuneration received by the employer by economic activity of enterprise
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Note: Percentages may not add up due to rounding.
Actual hours worked and hours paid
The Labour Cost Survey also collects information on actual hours worked and hours paid. Employees in full-time equivalent in arts, entertainment, recreation, and other service activities, as well as, manufacturing, mining, and quarrying and other industry, worked the most hours in 2020, averaging 38 hours per week, as opposed to 33 hours for employees in the public administration, defence, education, human health, and social work activities sector. Arts, entertainment, recreation, and other service activities together with manufacturing, mining, and quarrying and other industry and the construction sector recorded the highest average weekly paid hours (42 hours) (Chart 5, Table 11).
Chart 5. Average weekly hours worked and paid in FTE by economic activity of enterprise
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Note: Data is in full-time equivalent.
Hours worked and hours paid – Full-time employees
Full-time employees worked an average of 34.2 hours per week. The highest number of weekly overtime hours among full-time employees was recorded in the construction sector (2.5 hours). Vacation leave averaged 3.9 hours per week for full-timers, with individuals employed in the financial and insurance activities sector and the information and communication sector having the lowest amount of leave in 2020 (3.7 hours). The manufacturing, mining and quarrying and other industry had the highest number of paid but not worked weekly hours. The average paid absence per week in this economic activity was of 5.0 hours (Table 12).
Hours worked and hours paid – Part-time employees
The average weekly hours worked by part-time employees amounted to 18.7 hours. Part-timers working in manufacturing, mining and quarrying and other industry, as well as those engaged in wholesale and retail trade, transportation and storage and accommodation and food service activities, tended to work the most overtime hours per week (0.6 hours). Part-time real estate workers had the most average weekly hours of vacation leave (1.9 hours), while part-time workers in public administration, defence, education, human health and social work had the least (0.5 hours) (Table 13).
Overall, hours actually worked by employees accounted for 88.8 per cent of total paid hours. The remaining hours (11.2 per cent) were paid but not worked (Chart 6).
Chart 6. Percentage distribution of paid hours
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Additional Tables and Charts
Methodological Notes
1. The Labour Cost Survey is an enterprise-based survey carried out once every four years under EC Regulation No. 1737/2005 and implementing Council Regulation No. 530/1999. The aim of the survey is to obtain information on the costs borne by employers in order to employ staff.
2. The Labour Cost Survey is designed to satisfy the concepts and definitions as outlined by Eurostat, which is the EU Statistical Agency. This allows the comparability of results with other EU Member States and countries. The economic activity is classified according to NACE Rev. 2 (Nomenclature statistique des activités économiques dans la Communauté européenne). All economic activities employing 10 or more persons are covered by this survey, except agriculture, forestry and fishing (NACE A), activities of households as employers, undifferentiated goods and services producing activities of households for own use (NACE T) and activities of extraterritorial organisations and bodies (NACE U).
3. Definitions:
Labour costs refer to the total expenditure borne by employers in order to employ staff. They cover wage and non-wage costs less subsidies and include vocational training costs or other expenditures, such as recruitment costs, expenditure for protective clothing, etc.
Wages and salaries include direct remuneration, bonuses, and allowances paid by an employer in cash or in kind to an employee in return for work done. In addition, the definition covers payments for days not worked and remuneration in kind such as food, drink, fuel, company cars, etc.
Social contributions include expenses related to statutory social contributions which are incurred by employers in order to secure the entitlement to social benefits for employees. In addition, such contributions include imputed social contributions incurred by employers, such as non-obligatory social contributions, payments to private health insurance schemes, payments associated with sick leave (if incurred by employers), etc.
Vocational training costs refer to expenditure on services and facilities relating to vocational training. Such costs may involve expenditure for the participation of employees in courses, fees paid to instructors providing training to employees, expenses on teaching aids and tools and small repairs or maintenance of buildings and installations which are used for training purposes.
Subsidies on direct remuneration include all amounts received in the form of subsidies of a general nature intended to refund part or all of the cost of direct remuneration but not intended to cover social-security or vocational training costs. They do not include refunds paid to the employer by social-security institutions or supplementary insurance funds.
Other expenditures paid by the employer include payments for uniforms and protective clothing provided to employees and recruitment costs, such as expenditure on job advertisements in different media.
Contractual hours refer to the hours specified in an employment contract that an employee is required to work within a defined period, typically a week or a month. These hours may vary depending on the terms and conditions of the contract, including full-time or part-time status, and the nature of the work or industry.
Paid hours are defined as the total number of hours for which an employee is compensated by their employer. This includes not only the hours that the employee actually worked, but also any other hours for which they receive compensation, such as vacation leave, public holidays, sick leave, and any other type of paid absence from work.
Actual hours worked are defined as the time spent working by employees. These include the normal working periods as well as overtime. Hours worked exclude vacation leave, public holidays, sick leave and any other type of absence from work for which the employees are paid.
Paid absences refer to hours which are not actually worked by employees but for which remuneration is still provided. Examples include annual holidays/vacation, sick leave hours, public holidays and other paid hours such as hours associated with maternity leave or marriage leave.
Full-time equivalent (FTE) is a measure used to express the total number of hours worked by all employees on a full-time basis. It takes into account part-time employees who are converted into full-time units based on the normal working hours of full-time workers in the organisation.
4. More information relating to this news release may be accessed at:
Sources and methods
Statistical concepts
Metadata
NACE Rev. 2 Classification
5. References to this news release are to be cited appropriately.
6. Statistics in this news release should be interpreted in the context of the COVID-19 situation.
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8. A detailed news release calendar is available online.
- During 2020, the average labour cost per hour amounted to €13.54.
- Wages and salaries accounted for 92.2 per cent of the total labour cost.
- During 2020, vocational training costs almost reached €31 million.
- Approximately €334 million were provided in subsidies on direct remuneration in 2020, with the biggest recipients being enterprises within wholesale and retail trade, transportation and storage and accommodation and food service activities.
- On average, each employee worked 1,879 hours in 2020.
