Wage costs fall faster than in other OECD countries

Figures released by the Organisation for Economic Cooperation and Development OECD appear to show that the policy of wage restraint is bearing fruit. According, to the OECD figures, during the first three months of year wage costs in Belgium fell more quickly that in any other OECD member country.

During the first quarter of 2015 wage costs in Belgium fell by 1.1% compared with the last quarter of 2014. The “labour cost per unit” figures are arrived at by setting of the cost employing someone set off against his/her productivity.”

During the first quart of this year the labour cost per unit fell by 1.1% in Belgium. This is due both to a fall in the cost of employing someone and an increase in productivity.

However, most important of all are the wage restraint measures contained in the accord reached between the employers and (two of) the trade unions in which it was agreed that there should be no increases in gross pay this year. Furthermore, low inflation has meant that index-linked pay rises have been negligible.

The Belgian Employers Federation VBO says that the fall in labour costs is good news. “This is the first step in the right direction towards getting rid of our wage handicap”, VBO’s Chief Economist Edward Roosens told journalists. However, pointing to the historic wage handicap of 15.5%, Mr Roosens added that “There is still a long way to go”.