In 2024

Labour Cost Index (LCI) in the Autonomous Region of Madeira increased by 7.8% compared to the previous year

In the fourth quarter of 2024, the LCI (adjusted for working days) in the Autonomous Region of Madeira (ARM) recorded an increase of 7.6% compared to the fourth quarter of 2023. This increase resulted from the combined effect of changes in its two main components:

• Wage costs (per hour worked), which rose by 7.6% compared to the same quarter of the previous year.

Wage costs encompass the base salary, regular bonuses and allowances, irregular bonuses, and allowances (holiday bonus, Christmas bonus, year-end bonuses/profit sharing, and other irregular bonuses and allowances), payment for overtime work, and payments in kind.

• Other costs (non-wage, also per hour worked), which saw a year-on-year increase of 7.7%.

Other costs include severance payments, legal charges borne by the employer (employer’s contribution to Social Security, work accident and occupational disease insurance), as well as conventional, contractual, and optional charges (supplementary retirement/disability benefits, health insurance, life/personal accident insurance, social benefits paid directly to the worker in case of absence due to illness).

The year-on-year evolution of the Labour Cost Index in the Autonomous Region of Madeira resulted from the combined effect of the increase in average costs per worker and the decrease in the number of hours worked per worker.

At the national level, the value of the index recorded a year-on-year increase of 9.6%, comprising a rise of 9.6% in the wage costs and 9.5% in other costs.

In annual terms, the Labour Cost Index (LCI) in the Region recorded an increase of 7.8% in 2024 compared to the previous year, driven by the annual growth observed in wage costs and other costs (both with +7.8%). In the whole country, the annual change of this index stood at 8.2%, reflecting increases of 8.2% in wage costs and 8.1% in other costs.

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