13-11-2020 - In the third quarter of 2020, the Labour Cost Index increased by 3.2% from the corresponding quarter

In the third quarter of 2020

Labour Cost Index increased by 3.2% from the corresponding quarter

With the publication of the 3^rd quarter 2020 results, the Regional Directorate of Statistics of Madeira resumes the publication of the Labour Cost Index, with a new series, which has 2016 as its base year. Besides the base year change, from the 1^st quarter 2019 onwards, the information concerning the components of the Labour Costs, previously collected directly from the enterprises, was obtained from administrative source (Social Security). The number of hours actually worked continues to be gathered by direct inquiry for a sample, being that the unit of observation is now the enterprise and not the local unit, so the data for the Autonomous Region of Madeira concerns to enterprises headquartered in the Autonomous Region of Madeira. Data for the Public Administration is also now included.

The Labour Cost Index (working days adjusted) increased by 3.2% in the 3^rd quarter of 2020, compared with the same period of 2019.

The two main labour cost items are “wage costs” (per hour actually worked) and “other costs” (non-wage costs but per hour actually worked).

The first includes:

Base wage
Regular bonuses and allowances
Irregular bonuses and allowances (holiday bonus, Christmas bonus, end-of-year bonuses/distribution of profits, other irregular bonuses and allowances)
Payment of overtime
Payment in kind

The other costs includes:

Severance payment
Employers’ legal costs (social security contributions, insurance against accidents and occupational disease)
Collectively agreed, contractual and voluntary costs (supplementary pension/invalidity benefit, health insurance, life/personal accident insurance, and social benefits paid directly to employees in case of absence on account of sickness)

“Wage costs” increased by 3.8% and the “other costs” by 0.9% from the year-ago quarter, respectively.

At the country level, the index increased by 6.0% year-on year. “Wage costs” went up by 6.2% and the “other costs” by 4.9%.