Now our wages are no higher than rest of EU
Published 28/03/2014 | 02:30
IT costs less to employ a worker in Ireland than in many other European countries after years of wage stagnation.
New Eurostat figures show that Ireland is now close to the eurozone average for labour costs and behind high-wage countries such as Denmark, Belgium and France.
However, labour costs here are still significantly higher than in our nearest neighbour Britain.
It still costs just €3.70 an hour to employ a worker in Bulgaria even though wages have risen fast there in recent years, but this is still just a tenth of the €40.10 an hour in expensive Sweden.
Irish labour costs on average €29 an hour putting them just ahead of the eurozone average of €28.
The cost of employing workers in Ireland has barely increased at all since 2008, whereas throughout Europe wage costs are up 10pc since the recession kicked in.
Irish employers also face much lower non-wage costs than companies in other countries. These costs, which include things like social insurance contributions, only amount to 13.8pc of the cost of employing workers in Ireland, whereas the eurozone average is over 25pc.
The Eurostat survey covers enterprises employing over 10 people although it excludes agriculture and the civil service.
It shows Irish labour costs have risen by just 0.5pc since 2008, though workers have been spared the massive 18.6pc reduction seen in Greece.
It also shows that Irish labour costs are higher in industry at €30.70 an hour than in business or services, with construction labour costs the lowest at €25.50 an hour.
The non-business sector has the highest labour costs at €34.30 an hour, which is nearly 50pc higher than the EU average.
This sector includes education, human health, social work, arts, entertainment and recreation but does not include public administration.
The United Kingdom, meanwhile, has seen labour costs stagnate at €20.90 an hour in recent years.
That means it still costs nearly 40pc more to employ a worker in Ireland than in our nearest neighbour.
Labour costs include all pay and bonuses, holiday pay and benefit-in-kind such as food and company cars, but does not include training or recruitment costs or expenses such as uniforms.