Eurostat, the statistical office of the European Union
(EU), reported on Monday that hourly labour costs in the euro area increased by
3.4 per cent y-o-y in the first quarter of 2025, following a 3.8 per cent y-oy
rise in the previous quarter. This was the weakest gain since the third quarter
of 2022 (+3.2 per cent y-o-y).
According to the report, two main components of labour
costs - wages and salaries, and non-wage costs – demonstrated mixed tendencies
compared to the prior quarter.
The hourly wages and salaries increased by 4.2 per
cent y-o-y, slowing from 4.1 per cent y-o-y in the fourth quarter of 2024. This
marked the fourth quarter of slowdown in the annual pay growth and represented
the weakest pace of wage increase since the third quarter of 2022 (+2.4 per
cent y-o-y).
Meanwhile, the non-wage component advanced by 3.4 per
cent y-o-y, accelerating from 2.7 per cent y-o-y in the previous quarter.