Social Standards
Topics | Wages
Labour Cost in European Countries
In In the discussion about the wage development, labour cost plays an important role. Labour cost comprises not only the gross wage of the employee but also the legal and tariff payments of the employer (without material cost and profit).
| Wage | Social insurance employee | Social insurance employer | Misc. | Tax | Employer gross | |
|---|---|---|---|---|---|---|
| Belgium | € 8.40 | 6.5 % | 22,0 % | € 8.40 | ||
| Denmark | € 15.23 | 7.2 % | 35.0 %*) | € 15.23 | ||
| Germany | € 8.40 | 20.37 % | 17.7 % | 0,3 % | 10.3 % | € 9.89 |
| Estonia | € 1.59 | 3.0 % | 33.0 % | 26.0 % | € 2.11 | |
| Finland | € 8.80 | 6.9 % | 35.0 % | 21.0 % | € 11.88 | |
| France | € 8.50 | 39.34 % | 13.0 % | 5,4 % | 12.0 % | € 9.61 |
| Italy | € 6.87 | 26.5 % | 26.0 % | € 8.66 | ||
| Lithuania | € 1.18 | 34.0 % | 26.0 % | 17.8 % | € 1.55 | |
| Netherlands | € 11.17 | 6.0 % | 21.0 % | 0.2 % | 21.0 % | € 13.52 |
| Austria | € 6.85 | 17.2 % | 20.6 % | 2.28 % | 24.18 % | € 8.26 |
| Slovakia | € 1.59 | 13.0 % | 19.0 % | € 1.80 | ||
| Slovenia | € 5.52 | 22.0 % | 15.0 % | 25.0 % | € 6.35 | |
| Czechia | € 2.12 | 12.5 % | 34.0 % | 20.0 % | € 2.84 |
On the comparability of data: This work presents complicated issues in a simple manner for better reading and comparablity. Two comments for explanation:
The basis for a comparison of the gross wage is the skilled worker (trained) after one year of employment.
The percentage numbers quoted may vary, for instance, in Germany, the wage tax rate is based in the amount earned, the family situation etc. The wage tax rate will increase with a rising income.
A (German) sample calculation:
The amount of the labour cost does not divulge anything about what services the employee will receive for the contribution towards social insurance. For instance, in Germany and the Netherlands, comprehensive services are granted, such as further training and wage substitution. In most accession countries, the services for the unemployed are much more meagre.
| Gross wage of the worker | 8.40 € | |
| reduced by 20.37 percent social insurance by the employee | 20.37 % | 1.71 € |
| reduced by 10.3 percent tax | 10.37 % | 0.87 € |
| Misc. | 0.0 % | |
| Net wage | 5,82 € | |
| Employer's share to social insurance | 17.7% | 1.49 € |
| Labour cost of the employer per hour | 9.89 € |
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