De samlede lønomkostninger i eurozonen er faldet kraftig fra sidste år til 1. kvartal i år – til 1,5 pct., målt på årsbasis. Der var en stigning på 2,8 pct. i fjerde kvartal. De forhandlede lønomkostninger faldt endnu mere, til 1,4 pct. ABN Amro venter, at de forhandlede lønomkostninger forbliver lave i de kommende kvartaler. Det bidrager til at holde inflationen nede.
Eurozone wages signal weak inflationary pressures
Euro Macro: Wage growth drops lower –
Eurostat published its report on quarterly hourly labour costs for 2021Q1. The costs are corrected for the impact of tax changes and government subsidised short-time work schemes, which means that they reflect the labour costs that actually have to be paid by companies.
The rise in total labour costs slowed down markedly, to 1.5% yoy in 2021Q1, down from 2.8% in 2020Q4 (revised lower from 3.0%).
The breakdown of the main components shows that the rise in hourly wages and salaries decreased to 2.2%, down from 3.5%, while non-wage labour costs (which largely reflects the impact of taxes and government subsidies) dropped to -0.9%, down from +0.8%. The impact of the short-term work schemes clearly is illustrated by the change in the non-wage labour costs in the sectors that were impacted most heavily by lockdown measures, with non-wage labour costs plummeting by more than 19% yoy in Arts, entertainment and recreation and falling by 10.5% in Accommodation and food services activities.
As this measure of wage growth is also impacted by the number of hours worked and not only by the change in wages, alternative measures can give more information about underlying wage pressure in the eurozone.
Indeed, the ECB prefers to look at the change in negotiated wages as it excludes the impact of wage-drift and one-off factors. It tends to reflect changes in supply and demand for labour and the resulting bargaining power of employees. As such, it is a good indicator for the tightness in the labour market and underlying wage pressure, which in turn is a main driver for inflation in the medium term.
The graph below shows that negotiated wage growth has slowed down noticeably since the middle of 2019 (from 2.6% in 2019Q3 to 1.4% in 2021Q1). Looking forward we expect negotiated wage growth to remain at low levels in the coming quarters as a lot of slack has built up in the eurozone labour market since the start of the pandemic. This supports the view that underlying inflationary pressures will remain weak over the medium term.
