Federal Statistical Office
Germany ranks 6th in Europe for labor costs
Employers in the German manufacturing industry and economic services paid an average of €34.50 per hour worked in 2017. According to the Federal Statistical Office (Destatis), this put Germany's labor cost level in sixth place within the European Union, one place higher than in 2016.
Measured against the EU average of 26.30 euros, German employers paid 31% more for an hour's work. However, compared to neighboring France (36.80 euros), for example, which ranked fifth, it was almost 6 percent less. Denmark had the highest labor costs per hour worked at 43.60 euros, while Bulgaria had the lowest at 4.90 euros.
Manufacturing industry particularly wage-intensive in EU comparison
In the manufacturing sector, which is particularly exposed to international competition, an hour's work in Germany cost an average of €40.20 in 2017. Here, Germany ranked fourth in the EU. An hour's work in German industry was therefore 49% more expensive than the EU average (€27.00) and cost a good 6% more than in France (€38.10). In market-related services, Germany ranked ninth in Europe with labor costs of 31.50 euros per working hour (20 percent above the EU average and 14 percent below the figure for France).
Non-wage labor costs below EU average
Labor costs are made up of gross earnings and non-wage labor costs. In 2017, employers in Germany in the manufacturing and business services sectors paid an additional 28 euros in non-wage labor costs for every 100 euros in gross earnings. This means that non-wage labor costs in Germany were below the EU average of 31 euros.
In the EU-wide ranking, Germany was in mid-table in 13th place. The highest non-wage labor costs per 100 euros of wages were paid in Sweden (49 euros), France (46 euros) and Belgium (43 euros), and the lowest in Malta (9 euros). The main component of non-wage labor costs are employers' social security contributions, i.e. above all the statutory employer contributions to social insurance, expenses for company pension schemes and expenses for continued payment of wages and salaries in the event of illness. am
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