Labour costs in Spain

The National Statistics Institute, or INE’s quarterly survey on labor costs (ETCL) measures the quarterly development of labor costs facing companies and the gross salaries which employees have to live on.
The survey’s data is taken from questionnaires completed by sample of 19,500 establishments with workforces of over 500 throughout Spanish territory.

1.Total labor costs

The average labor cost per employee and month over the second quarter of 2005 has been 2,122.18 euros, up 3.4% from the same period a year earlier.

According to a sector analysis, at 2.425,27 euros per worker and month, the primary and secondary industries have seen the highest average labor costs, up 3.7% from a year earlier. Construction, where costs have risen 3.3% to 2,113.29 euros, has seen the next high average labor costs followed by the service sector, where they were up 3.6% at 2,033.08 euros.

A breakdown by Autonomous Communities shows that labor costs per worker and month have been highest in Madrid at 2,522.25 euros, followed by Navarra where they stood at 2,392.03 euros and the Basque Country where they reached 2,381.99 euros. The areas with the lowest labor costs have been Extremadura with 1,703.40 euros, followed by the Canary Islands where they were 1,749.55 euros and Galicia where they stood at 1,768.41 euros.

Labor costs per hour of work increased 1.5% to 14.71 euros. This growth has been lower than the increase in labor costs per worker and month. The disparity is due to a 1.9% increase in total number of hours worked, reflecting fewer public holidays during the quarter as the Easter break fell in March this year, compared to April in 2004. Sector by sector, primary and secondary industry labor costs increased 1.8% to 16.02 euros per hour, while in construction they rose 0.6% to 13.44 euros per hour, increasing 1.7% to 14.57 euros in the services sector.

2. Salary costs

Average salary costs per employee and month increased 3.4% in the second quarter to 1,575.43 euros from a year earlier. Ordinary salaries ie: without extra or back payments, grew 3.0% to 1,341.19. The difference between the two figures reflects extra and back payments.

Sector by sector, salary costs per worker and month in industry have increased 3.1% to 1,794.53 euros, while in services they have risen 3.8% to 1,526.41 and in construction 3.3% to 1,494.27. The greatest growth in salary costs was seen in services, where they grew 3.2%, followed by construction, where they were up 3.1% and industry, which saw a 3.0% rise. In terms of Autonomous Communities, Madrid boasts the highest salaries, 1,904.83 euros per worker and month, followed by Navarra where they stand at 1,798.49 and the Basque Country with 1,755.53. The regions with the lowest salaries are: Extremadura, at 1,229.83, Galicia, at 1,274.29 and the Canary Islands where they were 1,282.04.

The salary costs per hour worked increased 1.5% to 10.92 euros reflecting a greater number of hours worked due to few public holidays over the quarter than a year earlier.

3. Hours worked

On average, employees have worked a collectively agreed 154.7 hours per month in the second quarter, an effective 144.3 hours per month, with 13.9 hours not worked. Vacations and public holidays account for 51.3% of the hours not worked.

Full time workers have worked a collectively agreed 169.8 hours and an effective 155.6 real hours, with hours not worked at 15.1 per worker per month. Part time workers have worked an agreed 84.3 hours, an effective 77.7 hours, with hours non worked totaling 6.8. Construction has seen the most agreed and effective hours worked, at 171.3 and 159.8 respectively. In terms of part time work, industry has seen the highest number of agreed hours, at 85.9, while construction has seen the highest number of effective hours worked, at 81.3.

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