Changes in labour costs in the 2ndquarter of 2007

14.09.2007

Compared to 2nd quarter of previous year, in the 2nd quarter of 2007 the average hourly labour costs 1) in the country increased by 31.6%, according to data of Central Statistical Bureau. Hourly labour costs in this period increased from 2.46 lats to 3.23 lats or by 78 santims per hour.

In the public sector2) hourly labour costs in the 2nd quarter of this year were 4.01 lats and within a year they have increased 34.5% or by 1.03 lats per hour, in the private sector – 2.88 lats and the 31.2% increase or 69 santims per hour.

The main components of labour costs are gross wages and salaries and other labour costs3). Gross wages and salaries per one hour in the 2nd quarter of this year was 2.57 lats and, compared to 2ndquarter of 2006, they have increased by 31.9% or 62 santims per hour. Other labour costs were 0.66 lats per hour and in this period they have increased by 30.4% or by 15 santims per hour.

In the 2nd quarter of 2007 gross wages and salaries per one hour in the public sector were 3.17 lats (increase over 2nd quarter of previous year – 31.5% or 82 santims per hour), but in private sector – 2.30 lats (increase over 2nd quarter of previous year – 35.1% or 55 santims per hour). In the 2nd quarter of this year other labour costs in the public sector were 0.83 lats and, in comparison with 2nd quarter of 2006, they have increased by 32.6% or 21 santims per hour, but in private sector – 0.58 lats, comprising an increase of 30.0% or 13 santims per hour.

In the 2nd quarter of 2007, the highest hourly labour costs were in financial intermediation – 6.94 lats, in public administration and defence; compulsory social security - 5.06 lats, in electricity, gas and water supply – 4.97 lats. Compared to the 2nd quarter of previous year, the highest increase was in public, social and personal activities – by 41% or by 83 santims per hour, in agriculture, hunting and forestry – by 40.6% or by santims per hour, health and social care - by 38.9% or by 93 santims per hour.

In the second quarter of 2007 within the regions the highest labour costs were in Riga – 3.63 lats per hour, as well as in the region of Pieriga – 3.14 lats. Compared to 2nd quarter of previous year hourly labour costs most rapidly increased in the regions of Kurzeme and Zemgale – respectively by 36.3% and 34.8%, but the lowest increase was in the region of Latgale – by 30.4%.

To compare the data of the first and second quarters of this year, it should be highlighted, that average hourly labour costs in the country have increased by 16.1%, of which gross wages and salaries – by 17.1%, other labour costs – by 12.6%.

Hourly labour costs
(in lats)

 

 

II quart. 2006

I quart. 20074)

II quart. 2007

II quart. 2007 increase over I quart 2007, in %

II quart. 2007 increase over II quart. 2006, in %

Total in the country

 

labour costs total

2.456

2.783

3.231

16.1

31.6

  

gross wages and salaries

1.950

2.197

2.572

17.1

31.9

  

other labour costs

0.506

0.586

0.660

12.6

30.4

Of which:

In public sector 2)

 

labour costs total

2.980

3.180

4.007

26.0

34.5

  

gross wages and salaries

2.351

2.493

3.173

27.3

35.0

  

other labour costs

0.629

0.687

0.834

21.4

32.6

In private sector

 

labour costs total

2.197

2.592

2.883

11.2

31.2

  

gross wages and salaries

1.750

2.054

2.302

12.1

31.5

  

other labour costs

0.447

0.537

0.581

8.2

30.0

 

Hourly labour costs by kind of activity
(in lats)

 

 

II quarter 2006

II 2007

labour costs total

of which

labour costs total

of which

gross wages and salaries

other labour costs

gross wages and salaries

other labour costs

Total

2.456

1.950

0.506

3.231

2.572

0.660

Agriculture, hunting and forestry (A)

1.952

1.549

0.402

2.744

2.171

0.573

Fishery a (B)

1.462

1.154

0.308

2.472

1.975

0.497

All industries, except Agriculture and forestry (C-O)

2.470

1.961

0.509

3.244

2.582

0.635

Industry and services– total(C-K)

2.366

1.877

0.490

3.071

2.443

0.665

Industry – total(CDE)

2.356

1.851

0.505

3.052

2.411

0.641

 

Mining and quarrying (C)

2.515

2.001

0.514

3.408

2.727

0.681

 

Manufacturing (D)

2.201

1.744

0.457

2.875

2.283

0.592

 

Electricity, gas and water supply

3.965

2.954

1.011

4.971

3.784

1.188

Construction (F)

2.181

1.741

0.440

2.977

2.379

0.598

Wholesale, retail sale, repair of motor vehicles, motorcycles, personal, household goods (G)

1.932

1.542

0.390

2.591

2.072

0.520

Hotels and restaurants (H)

1.475

1.180

0.295

1.916

1.534

0.383

Transport, storage and communications (I)

2.733

2.145

0.588

3.489

2.746

0.744

 

Land transport, transport via pipeline (60)

2.309

1.815

0.495

2.983

2.343

0.640

 

Water transport (61)

6.435

5.779

0.656

5.131

4.525

0.606

 

Air transport (62)

8.780

7.083

1.697

11.542

9.493

2.049

 

Transport auxiliary and ancillary activities of tourism agencies (63)

2.994

2.363

0.631

4.035

3.193

0.842

 

Post and telecommunications (64)

3.240

2.455

0.785

3.770

2.875

0.895

Financial intermediation (J)

5.639

4.489

1.150

6.938

5.580

1.359

Real estate, renting, computer services, science and business activities (K)

2.628

2.108

0.520

3.273

2.618

0.655

Public administration and defence; compulsory social security; education; Health and social work; Public, social and personal activities (L-O)

2.718

2.164

0.554

3.669

2.923

0.746

Public administration and defence; compulsory social security; (L)

3.749

2.945

0.804

5.058

4.003

1.055

Education (M)

2.441

1.961

0.480

3.182

2.547

0.635

Health and social work (N)

2.381

1.901

0.480

3.308

2.642

0.665

Public, social and personal activities (O)

2.018

1.628

0.390

2.846

2.279

0.567

 

of which
recreational, culture and sports activities(92)

2.109

1.691

0.418

2.957

2.372

1.055

Hourly labour costs by regions
(in lats)

 

 

II quart. 2006

I quart. 20074)

II quart. 2007

II quart. 2007 increase over I quart 2007, in %

II quart. 2007 increase over II quart. 2006, in %

Latvia

 

labour costs total

2.456

2.783

3.231

16.1

31.6

  

gross wages and salaries

1.950

2.197

2.572

17.1

31.9

  

other labour costs

0.506

0.586

0.660

12.6

30.4

Of which:

Riga

 

labour costs total

2.800

3.163

3.625

14.6

29.5

  

gross wages and salaries

2.221

2.492

2.882

15.7

29.8

  

other labour costs

0.579

0.671

0.743

10.7

28.3

Pieriga region

 

labour costs total

2.339

2.647

3.142

18.7

34.3

  

gross wages and salaries

1.862

2.093

2.505

19.7

34.5

  

other labour costs

0.477

0.554

0.637

15.0

33.5

Vidzeme region

 

labour costs total

1.939

2.160

2.562

18.6

32.1

  

gross wages and salaries

1.545

1.716

2.045

19.2

32.4

  

other labour costs

0.395

0.443

0.517

16.7

30.9

Kurzeme region

 

labour costs total

2.004

2.309

2.731

18.3

36.3

  

gross wages and salaries

1.592

1.826

2.174

19.1

36.6

  

other labour costs

0.412

0.483

0.557

15.3

35.2

Zemgale region

 

labour costs total

1.982

2.244

2.671

19.0

34.8

  

gross wages and salaries

1.579

1.784

2.136

19.7

35.3

  

other labour costs

0.403

0.460

0.535

16.3

32.8

Latgale region

 

labour costs total

1.795

1.982

2.341

18.1

30.4

  

gross wages and salaries

1.425

1.570

1.866

18.9

30.9

  

other labour costs

0.370

0.412

0.475

15.3

28.4

___________________
1) Labour costs are employer’s expenditures that are necessary for employing workforce. The main components of labour costs are gross wages and salaries and other labour costs. In total and in other labour costs data on state granted subsidies on remuneration are not included.

 

Average hourly labour costs are calculated dividing the sum of labour costs with number of hours actually worked. The main components of labour costs are calculated in the same way – Gross labour costs and other labour costs in the one worked hour.

The calculation of labour cost components and hourly labour costs corresponds to the European Parliament and Council Regulation (EC) No 450/2003 of 27 February 2003 on the labour cost index.

 

2) Public sector represents state and local government institutions and commercial companies of these institutions, as well as commercial companies with state or local government capital participation 50% and over and foundations, associations, funds and commercial companies thereof.

 

3) In Other labour costs are included: statutory social security contributions payable by employer, employers’ contractual and voluntary social security contributions (additional pension insurance contributions, health and life insurance contributions etc.), support payments from employer, awards, gifts, payments for sick list A, severance pay, remuneration in the event of short-time working, entrepreneurship state risk duty. In labour costs vocational training costs are not included, as well as recruitment costs, costs for work appeal and uniforms, costs on for work necessary medical inspections and vaccination, costs for specific food and beverages.

The changes of hourly labour costs are calculated taking into account the changes of the number of working days and seasonal influence. Seasonally adjusted and not adjusted data on the country generally are in the home page of the Central Statistical Bureau - www.csb.gov.lv in the section Data bases – population income and labour costs - monthly/quarterly data.

4) Data are revised.

Prepared by the Wage Statistics Section
Ervīns Rekke
Tel. 6 7366666
ervins [dot] rekke [at] csb [dot] gov [dot] lv