Changes in labour costs in the 3rd quarter of 2009

14.12.2009

Compared to the 3rd quarter of the previous year hourly labour costs in the country1) in the 3rd quarter of 2009 reduced by LVL 0.16 or by 3.9% (seasonally non-adjusted data), according to the data of Central Statistical Bureau. But according to seasonally adjusted2) data they diminished by 3.1%.

 

Changes of hourly labour costs over corresponding quarter
of previous year, %
 

Compared to the 3rd quarter of previous year hourly labour costs in the 3rd quarter of this year in public administration and defence, compulsory social security decreased by LVL 1.39 or by 22.2%, in arts, entertainment and recreation – by LVL 0.53 or by 13.6%, in human health and social work activities – by LVL 0.52 or by 12.7%, in electricity, gas, steam and air conditioning supply – by LVL 0.49 or by 7.4%, in education – by LVL 0.41 or by 7.6%.

 

Hourly labour costs and their changes by kind of economic activity (seasonally non - adjusted data, by NACE Rev. 2 classification)

 

 

3rd quarter 2008

3rd quarter 2009

Changes, %

Total excluding agriculture and fishing

4.14

3.98

-3.9

Mining and quarrying

3.93

3.90

-0.7

Manufacturing

3.58

3.49

-2.6

Electricity, gas, steam and air conditioning supply

6.67

6.17

-7.4

Water supply; sewerage, waste management and remediation activities

3.94

3.79

-3.9

Construction

3.59

3.37

-6.0

Wholesale and retail trade; repair of motor vehicles and motorcycles

3.26

3.11

-4.7

Transportation and storage

4.06

4.20

3.5

Accommodation and food service activities

2.44

2.31

-5.2

Information and communication

6.53

6.81

4.3

Financial and insurance activities

7.86

7.95

1.0

Real estate activities

3.14

3.02

-3.9

Professional, scientific and technical activities

4.80

4.69

-2.2

Administrative and support service activities

3.38

3.22

-4.6

Public administration and defence; compulsory social security

6.26

4.87

-22.2

Education

5.33

4.93

-7.6

Human health and social work activities

4.13

3.60

-12.7

Arts, entertainment and recreation

3.94

3.40

-13.6

Due to the rapid reduction of the number of employees and due to the fact that part of them changed their working time from full-time to part-time work, compared to the 3rd quarter of the last year the number of hours worked in the 3rd quarter of 2009 reduced by 27.3%, but labour costs during this time period decreased by 30.1%.

Examining share of hourly labour costs in wages and salaries and in other labour costs, it may be concluded that hourly labour costs have reduced by 4.7%, but other labour costs – only by 0.5%. Small reduction of other hourly labour costs may be explained with increase of severance payment – in 3rd quarter of 2009, compared to the corresponding period of previous year, it has increased from LVL 3.7 to 9.2 mln or 2.5 times.

 

Labour costs, hours worked and their changes (seasonally non-adjusted data)

 

 

3rd quarter 2008

3rd quarter 2009

Changes, %

Labour costs, total, mln LVL

1641.6

1148.1

-30.1

 

of which

   
 

wages and salaries

1306.8

905.8

-30.7

 

other labour costs

334.8

242.3

-27.6

Hours worked, mln

397.0

288.8

-27.3

Total hourly labour costs, LVL

4.14

3.98

-3.9

 

of which

   
 

Hourly wages and salaries

3.29

3.14

-4.7

 

other hourly labour costs

0.84

0.84

-0.5

1) This information does not include data on agriculture, forestry and fishing.
2) Influence of seasonality and varying number of working days has been averted.

Explanations

Hourly labour costs include gross wages and salaries and other labour costs. Wages and salaries are regular and irregular direct wages and salaries – basic salary (monthly, wage), payment for time worked or job completed, regular and irregular premiums and bonuses, payments for days not worked (vocation and other days not worked), sums of state mandatory social insurance contributions paid by the employees and personal tax. In accordance with the EU regulatory enactments when compiling data on labour costs wages and salaries include also wages and salaries in kind (goods and services provided by the employer to employees for free or for a lower price, living area, mobile telephone, transportation compensation, etc.). Other labour costs include state mandatory social security contributions, state voluntary social security contributions (additional pension, health, life insurance contributions, etc.) paid by the employer, employer’s allowances, awards, gifts, payment of sick list A, severance payment, business risk state duty.

Hourly labour costs are calculated dividing the sum of labour costs with number of hours actually worked.

 

Prepared byWages Statistics Section
Ervins Rekke
Tel. 67366666