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Latest NewsEconomics, government & businessHR practiceLabour market

Western Europe pays the price in employment costs

by Michael Millar 13 Apr 2005
by Michael Millar 13 Apr 2005

Employment costs in Western European countries are more than four times those in Eastern Europe, according to a new study.

The research, by Mercer HR Consulting, found the highest annual employment costs are borne by Belgium, Sweden and Germany, closely followed by Luxembourg and the UK. 

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In contrast, Latvia and Lithuania have the lowest employment costs.  Belgium’s average employment costs are as much as €53,577 (£36,507) while Latvia’s are just €4,753 (£3,239).  The average cost of employment across all EU states surveyed is €28,269 (£19,262).

The UK’s employment costs have gradually increased over the last two years and are now €46,541 (£31,713), which is 40% higher than in the US.
 
On average, employment costs in the EU are around 15% less than in the US.  But, taking Eastern EU countries out of the equation, costs in Western European countries are 23% higher.
 
“The survey highlights the competitive advantage that Eastern European countries have over western,” said Mark Sullivan, worldwide partner at Mercer.  “It is unsurprising that more companies are now moving their operations to Eastern Europe, where employment costs are so much lower.”

Michael Millar

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