The highest, as standard, hourly labor costs in the EU are paid by employers in Luxembourg, Denmark, and Belgium.

Inflation has triggered an avalanche of worker dissatisfaction in Europe with their wages, as we are witnessing in Croatia as well, while on the other hand employers are seeking room and pressuring their governments to reduce the burden of tax levies on them and free up part of workers' gross pay.

A chronic labor shortage has for quite some time been a problem everywhere in Europe and the main reason for the increase in labor costs, and last year at the EU level it cost employers an average of 30.5 euros per hour. Croatia is still significantly below the European average – before taxation and the payment of contributions, an hour of labor cost employers in Croatia an average of 12.1 euros.

Only three countries worse

Workers had lower hourly wages than ours only in a few countries, in Bulgaria, Romania, and Hungary, while Latvia, which until recently had a lower gross hourly wage, is now ahead of Croatia. The highest, as standard, hourly labor costs in the EU are paid by employers in Luxembourg, Denmark, and Belgium.

Gross hourly wages are higher in the old EU member states, and of all the post-socialist countries that joined the membership, Slovenia has the highest hourly wages, almost twice as high as those paid by Croatian employers (23.1 euros).

Back in the time of كورونا, by the way, gross hourly wages in Croatia were higher than in Lithuania and Latvia, but now that has changed too, and those countries also have higher gross hourly wage amounts.

In all countries over the past three years wages have risen, with the exception of Sweden where last year the average gross hourly wage fell from 40.8 in 2021 to 40.1 euros, while the most significant jump was recorded by Ireland, where in three years the hourly cost rose by 4.4 euros, to 37.9 euros. In Croatia, the gross hourly cost amounted to 10.8 euros in 2020, and 11.2 euros in 2021.

Examining the structure of labor costs by sector, HZZ analysts note large differences between member states, but as a rule the old EU member states, especially those in the north, have the highest wages, while Romania, Bulgaria, and Hungary have the lowest.

They note, for example, that in Germany, unlike in other countries, the wages of construction workers are significantly lower than those of industrial workers. In manufacturing, German employers last year paid an average of 44 euros per hour, while in the construction sector an hour of labor cost them 34.8 euros.

In Croatia, wages in industry were slightly higher, 11.2 euros per hour compared with 11 euros in construction, but in both sectors they were below the average hourly wage at the national level.

In Slovenian industry, meanwhile, average hourly wages amounted to 23.6 euros and were higher than the average in that country, and significantly higher than in construction (19.3 euros).

At the EU level, by the way, in the construction sector only Denmark and the Netherlands have wages higher than 40 euros per hour, and besides Bulgaria and Romania, only employers in Poland have a lower average hourly wage than Croatia.

The fact that the wages of construction workers in Germany are significantly more modest than those of industrial workers is linked by HZZ analysts to the influence of a relatively large number of foreign workers, which increased the labor supply and reduced wages.

23 euros in Slovenia

Below the average hourly wage in Croatia are also the transport sector (10.3 euros), administrative jobs (9.3 euros), and hospitality and tourism, in which the average hourly wage amounts to 9.6 euros. However, gross pay in hospitality and tourism is lower compared with other activities in other EU member states as well.

The highest “tourism” hourly wages are thus in Luxembourg (30.3 euros) and Belgium (29.8 euros), while wages in our tourism sector are higher than in Lithuania, Latvia, Malta, Hungary, Bulgaria, and Romania. Interestingly, at the same time the hourly wage in tourism in Slovenia is as high as 22.7 euros.

The highest wages are, as standard, in the finance sector, and last year they ranged from 11.3 euros in Bulgaria to 88.3 euros in Luxembourg. Croatia's finance workers' wage amounted to 16.5 euros per hour.

Gross wages in the ICT sector follow in size, and in the EU they are most generous in Sweden (59.5 euros) and Ireland 57.8 euros). In Croatia too, average gross wages are highest in this activity, but at 17.8 euros it lags even behind Romania (18.9 euros). In Slovenia in this sector, meanwhile, the hourly wage amounts to 30.3 euros.

Source: poslovni.hr