Labour Cost

Labour cost is highest in the energy sector

Economic indicators
Labour cost is highest in the energy sector

In 2020, one hour of work cost a Belgian company an average of 40.5 euros per employee, compared to 38.6 euros in 2016. This is what emerged from the latest results of the four-yearly Labour Cost Statistic of Statbel, the Belgian statistical office, based on the population of local units of enterprises with at least 10 employees. The main findings are:

  • One hour of work is most expensive in the electricity and gas sector, while it is least expensive in the accommodation and food services sector.
  • Labour cost is generally higher in larger enterprises.
  • The hourly cost is the highest in the Brussels-Capital Region.
  • 88.3% of the labour cost results from direct remuneration and bonuses and statutory social security contributions payable by the employer.

Note: The figures in this press release reflect the situation in 2020 and have therefore been significantly impacted by Covid-19. For example, employers in the accommodation and food service activities made extensive use of temporary unemployment in 2020, resulting in reduced number of hours paid and worked and in labour cost per employee in this sector. For this reason, comparisons with previous years should be made with caution.

Significant differences in labour cost between the economic sectors

There are significant differences in hourly cost by sector. The labour cost can be over 60 euros per hour worked in electricity, gas, steam and air conditioning supply (66.5 euros) and financial and insurance activities (62.5 euros). By contrast, the lowest hourly costs are found in accommodation and food service activities (28.6 euros) and the arts, entertainment and recreation sector (30.9 euros).

The larger the company, the higher the labour cost

When labour costs are compared according to company size, they are generally highest in large enterprises (43.5 euros for enterprises with 500 to 999 employees and 43.4 euros for enterprises with 1000 employees or more) while the lowest hourly cost is found in small enterprises (10 to 49 employees) with 34.6 euros per hour worked.

The labour cost is the highest in the Brussels-Capital Region

With 47.3 euros per hour worked, the Brussels-Capital Region is the region in the country with the highest hourly cost. It is followed by the Flemish Region with 39.8 euros and the Walloon Region with 38.2 euros.

Direct remuneration and bonuses account for 66.5% of the labour cost

If we look at the breakdown of the labour cost, we see that direct remuneration and bonuses (66.5%) and statutory social security contributions payable by the employer (21.8%) account for 88.3% of this cost. The remaining 11.7% corresponds to among others payments for days not worked (7.9%) and wages and salaries in kind (2.3%).

Four-yearly statistic on labour cost

Purpose and short description

The four-yearly Labour Cost Statistic meets the statistical needs of the European Commission as defined in Council Regulation (EC) 530/1999 of 9 March 1999 and Commission Regulation (EC) 1737/2005 of 21 October 2005. Since 2016, the four-yearly statistic has been based exclusively on administrative sources (NSSO, NBB, FPS Finance, etc.). The data are collected according to the activity and location of the local unit, as well as the size of the enterprise to which the local unit belongs.

Survey population

The survey population consists of local units.

Until 2008, only the local units belonging to sections C to K and M to O of NACE rev.1 and belonging to the group of enterprises with at least 10 employees were analysed in this statistic.

From 2008, only the local units belonging to sections B to N and P to S of NACE rev.2 and belonging to the group of enterprises with at least 10 employees have been analysed in this statistic.

Data collection method and sample size

Since 2016, the four-yearly statistic on labour cost is exclusively based on administrative sources (NSSO, NBB, FPS Finance, etc.). Before 2016, the survey was based on a sample of local units of enterprises with at least 10 employees, selected in the NSSO(PLA) registers. Therefore, the comparison with the results prior to 2016 should be made with a great deal of caution.

Data from the NSSO (DmFA) are used in the estimates for the number of employees, the paid hours, the direct remuneration and bonuses, the payments for days not worked, the company cars as benefit in kind and the statutory social-security contributions payable by the employer.

Data from the FPS Finance on personal income tax (BELCOTAX) and on corporate tax (BIZTAX) are used to estimate payments to employees’ savings schemes, wages and salaries in kind, collectively agreed, contractual and voluntary social-security contributions, employers' imputed social contributions and subsidies.

The estimate of vocational training costs is based on the indexed results of the CVTS survey (see https://statbel.fgov.be/fr/themes/emploi-formation/formation-et-enseignement/formation-continue) for the year 2020.

Response rate

No enterprise surveyed.

Periodicity

The labour cost statistic is organised every four years. The last year is 2020.

Release calendar

The results must be disseminated two years after the reference period (in June to Eurostat and in October to the general public).

Definitions

Labour cost: total expenditure by employers on the employment of employees. It includes the direct remuneration in the reference period, the bonuses, the benefits in kind, the statutory social security contributions, the collectively agreed, contractual and voluntary social-security contributions, the employers' social contributions, the vocational training costs and the taxes, less any subsidies received.

Annual labour cost per full-time equivalent employee: the labour cost divided by the total number of full-time equivalent employees (number of full-time employees + number of part-time employees converted into full-time equivalents).

Monthly labour cost per full-time equivalent employee: the annual labour cost per full-time equivalent employee divided by the 12 months of the year.

Labour cost per hour worked: the cost of labour divided by the total number of hours actually worked.

Employees in the labour cost survey: employees are all persons who have a direct employment contract with the enterprise or local unit and receive remuneration, irrespective of the type of work performed, the number of hours worked and the duration of the contract. These include manual and intellectual workers as well as management staff.

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