Labour cost up 5.7% in Q2

  • Lusa
  • 12 August 2022

The sharpest increases in wage costs in this second quarter of 2022 were in industry (7.4%) and construction (7.1%), while in services and public administration, there were "smaller increases of 5.1%

Portugal’s labour cost index increased by 5.7% in the second quarter compared to the same period of 2021, accelerating the pace of increase compared to the previous three months (1.4%), Statistics Portugal (INE) announced on Friday.

Between April and June, wage costs (per hour effectively worked) increased by 5.6% (0.7% in the previous quarter) and other labour costs (also per hour effectively worked) rose by 6.3% (4.2% in the previous quarter).

The sharpest increases in wage costs in this second quarter of 2022 were in industry (7.4%) and construction (7.1%), while in services and public administration, there were “smaller increases of 5.1% and 5.0%, respectively”.

In the previous quarter, salary costs registered lower increases in all economic activities except for public administration.

Today’s publication from the INE stated that non-wage costs registered higher variations than wage costs, except for construction, where these costs presented an equal variation.

As in the previous quarter, the sharper increase in other costs resulted from the resumption of payment of employer contributions by companies, which in the same quarter had joined the simplified lay-off scheme or the Extraordinary Progressive Takeover Assistance.

The average cost per worker rose more sharply than in the previous quarter in all economic activities. The largest rises were recorded in construction and services (both up 5.1%), while public administration showed the smallest variation (2.4%).

INE also highlights that increases in Public Administration have been lower than those in other activities since the first quarter of 2021.

Except for services, the number of hours effectively worked per worker fell in all economic activities, with industry (-2.6%) and public administration (-2.5%) standing out.

In the same quarter, INE had recorded a significant increase in the number of hours effectively worked per worker in all activities – except construction – which is mainly explained by the total or partial closure of companies by legislative determination or due to the reduction of normal working hours due to the decrease in turnover.

The next Labour Cost Index for the third quarter of the year will be published on 14 November.