Pay Developments 2005

This review of trends in pay in 2004 and 2005 finds that average collectively agreed nominal wage increases across the EU rose from 4.1% in 2004 to 4.5% in 2005 (though with major variations between countries), reversing a previous steady downward trend. Taking into account inflation, the rate of real increase rose more sharply, from 1.1% in 2004 to 1.9% in 2005. In the EU 15, the average agreed nominal wage increase remained unchanged in 2005 at 3.0% and the rate of real increase fell from 1.0% in 2004 to 0.7% in 2005. However, in the 10 new Member States that joined in 2004, the average nominal increase rose from 5.6% in 2004 to 6.7% in 2005, and the rate of real increase climbed from 1.4% to 3.6%. The overall picture is thus of rather differing overall pay trends in the ‘old’ and ‘new’ EU. This review also looks at collectively agreed pay increases in six selected sectors (metalworking, chemicals, banking, retail, local government and the civil service), increases in average earnings (and current levels), increases in minimum wages (plus current rates), the gender pay gap and labour costs.

Author: Mark Carley, SPIRE Associates/IRRU, University of Warwick

10 July 2006

The European Industrial Relations Observatory (EIRO), which started operations in 1997, is based on a network of leading research institutes in all EU countries, Norway, Bulgaria and Romania and at EU level, coordinated by the European Foundation for the Improvement of Living and Working Conditions. Its aim is to collect, analyse and disseminate high-quality and up-to-date information on key developments in industrial relations in Europe, primarily to serve the needs of a core audience of national and European level organisations of the social partners, governmental organisations and EU institutions. www.eiro.eurofound.europa.eu

Pay developments - 2005

This annual update from the European Industrial Relations Observatory (EIRO), based on contributions from its national centres, aims to provide a broad, general indication of trends in pay increases over 2004 and 2005 across the EU Member States, two candidate countries (Bulgaria and Romania) and Norway. It looks at: collectively agreed pay rises across the economy as a whole and in six selected sectors; national minimum wage increases and rates; gender pay differentials; average earnings rises and levels; and labour cost increases and levels.

The report does attempt to produce a fully scientific and comparable set of pay comparisons, given that EIRO is not a statistical service and that pay is an area where meaningful international comparisons are particularly difficult. Differing national systems of pay formation, industrial relations, taxation and social security, and the divergent ways in which pay-related statistics are collected and presented, mean that comparisons between countries are hard to draw. Nevertheless, given the key importance of pay in industrial relations, EIRO provides these general indications of recent developments while pointing out the problems, reservations and qualifications. The figures provided should be treated with extreme caution, and the various notes and explanations read with care.

Average collectively agreed pay increases

Figure 1 below provides figures for average nominal collectively agreed basic pay increases in each country (or a broadly equivalent indicator, where these are not available). Where possible, the figures cover the whole economy, though there are exceptions (see the notes for the figure). Data are not yet available for the whole of 2005 in a number of cases. Variations in the 2004 figures from those appearing in the EIRO pay update for 2004 (TN0503103U) are explained mainly by the replacement of provisional or partial figures with more reliable ones, plus in some cases changes in the data used, where more appropriate sources have been identified. (In this and subsequent figures and tables, the data are sorted in order of increase (highest to lowest) for 2005. Where there is no 2005 figure, the country is ranked by its 2004 figure in comparison with the 2005 figures for the other countries.)

Collective bargaining plays a significant role in pay setting in all countries considered here (TN0401101F). Some two-thirds of the workforce of the European Union have their pay and conditions set, at least to some extent, by collective agreements - though the proportion considerably lower in many new Member States (e.g. Estonia and Latvia) and the UK, and higher in some of the EU 15 (e.g. France, Belgium, Sweden, Finland and Italy). The role of collective bargaining in pay determination differs widely. Notably, the various bargaining levels (intersectoral, sectoral, company etc) play different parts, while the importance of bargaining in pay determination differs considerably between economic sectors and groups of workers.

These differences in national pay formation and industrial relations systems are illustrated by the varying ways in which the increases referred to in figure 1 are arrived at. Free collective bargaining, primarily (though not entirely in all cases) at sectoral level, plays the main role in Austria, Cyprus, Denmark, France, Germany, Italy, the Netherlands, Norway, Portugal, Slovakia, Spain and Sweden. National intersectoral agreements are responsible for setting the relevant increases, or laying down guidelines for lower-level bargaining in Belgium, Finland, Greece, Hungary, Ireland, Romania (2005), Slovenia and Spain. In the UK and the majority of the new Member States and candidate countries, it is company- level bargaining (or bargaining at lower levels within the company) that is predominant. In several central and eastern European countries - Bulgaria, Estonia, Latvia, Lithuania and Poland - low levels of bargaining coverage and/or lack of systematic data collection make it impossible to produce figures for average collectively agreed pay increases (other indicators are thus used in figure 1). Automatic pay indexation represents a significant proportion of the increases in Belgium and Luxembourg. The role of the increases referred to in the figure also differs: in countries such as Austria, Denmark, France and Italy, the increases referred to are sectoral minima, subject to subsequent lower-level bargaining (or in the case of Austria, the application of actual pay increases agreed at sector level); while in decentralised-bargaining countries such as the UK, the figures are more likely to represent actual increases.

Nominal pay increases

EU 15 and Norway

Bearing in mind these qualifications, the following points emerge from figure 1. The first group of countries to be analysed is the 15 pre-May 2004 EU Member States and Norway.

• In 2004, nominal pay increases varied between 6.0% in Greece (the increase in minimum rates laid down in the National General Collective Agreement) and 1.3% in the Netherlands (where a virtual wage freeze was in force). Increases of 4% and over were recorded in two countries, increases of 3%-4% in five countries, increases of 2%-3% in eight countries, and increases of 1%-2% in one country. The average increase stood at 3.1% (3.0% in the EU 15 alone). • In 2005, nominal pay increases varied between 5.5% in Greece (again the increase in minimum rates laid down by intersectoral agreement) and 0.8% in the Netherlands (see previous point). Increases of 4% and over were recorded in two countries, increases of 3%-4% in six countries, increases of 2%-3% in six countries, increases of 1%-2% in one country, and increases of 1% or less in one country. The average increase stood at 3.0% (also 3.0% in the EU 15 alone). • The average increase thus fell very slightly from 2004 to 2005. This followed a fall from 3.8% in 2001 to 3.5% in 2002, 3.1% in 2003 and 3.1% in 2004. The average rate of increase seems to have been fairly steady for three years, after falling over 2001-3. • With regard to possible convergence, the range between the highest and lowest increases fell from 5.4 percentage points in 2001 to 3.6 points in 2002 and 2.4 points in 2003. However, it increased to 4.7 points in 2004 and remained the same in 2005. In 2004, the increases in 12 countries out of 16 were within 1 percentage point of the overall average rise, while in 2004 this was true of 13 countries. • Averaging the annual increases over the five-year period 2001-5, the 16 countries can be divided into: ‘low’ nominal pay-increase countries - those where pay increases averaged 2%- 3% (Austria, Belgium, Denmark, Finland, Germany, Italy and Sweden); ‘medium’ nominal pay- increase countries - those where pay increases averaged 3%-4% (France, the Netherlands, Portugal, Spain and the UK); and ‘high’ nominal pay-increase countries - those where pay increases averaged over 4% (Greece, Ireland, Luxembourg and Norway). The overall average annual pay increase over the five-year period was 3.3%. • There were, as usual, divergent trends in pay increases in the various countries. While the average increase fell from 2004 to 2005 in eight of the 16 countries (with pay moderation appearing most evident in Spain, Greece, Ireland and the Netherlands), following the overall slight downward trend, the rate of increase rose in five countries (most notably Austria and Belgium) and remained stable in three. Looking at the five-year period starting in 2001, the average overall trend - for increases to drop off from 2001 to 2003 then steadying before falling slightly in 2005 - has been mirrored to varying extents in Portugal, Ireland and Luxembourg. The Netherlands has seen a continuing fall since 2002, and Germany and Norway since 2003. Sweden and, to a lesser extent Denmark, maintained a high degree of stability over the whole period. Otherwise, few countries have displayed a clear trend in nominal pay increases, with most varying up and down from year to year. In terms of the size of the variations in annual increases over 2001-5, it seems that the countries with the greatest stability are Sweden, Denmark, the UK, Austria, Luxembourg, Spain, and France (in all cases the variation between the highest and lowest annual increases was lower than one percentage point), while the least stable are the Netherlands, Ireland and Greece.

Euro-zone

Taking only the 12 countries of the euro-zone, the following points can be made.

• In 2004, nominal pay increases varied between 6.0% in Greece and 1.3% in Belgium. Two countries recorded increases of 4% and over, while increases of 3%-4% were recorded in three countries, increases of 2%-3% in six countries and increases of 1%-2% in one country. The average increase stood at 3.1%. • In 2005, nominal pay increases varied between 5.5% and 0.8% -in Greece and the Netherlands respectively. Increases of 4% and over were recorded in two countries, increases of 3%-4% in four countries, increases of 2%-3% in four countries, increases of 1%-2% in one country and increases of below 1% in one country. The average increase stood at 3.0%.

• The average nominal pay increase in the euro countries was thus 0.1 points higher than in the EU 15 more widely in 2004, but the same in 2005.

New Member States

Turning to the 10 new Member States that joined the EU in 2004, the picture is somewhat different.

• In 2004, nominal pay increases varied between 9.6% in Latvia and 1.6% in Malta. Increases of 5%-10% were recorded in five countries, increases of 2%-5% in four countries, and increases of under 2% in one country. The average increase stood at 5.6% • In 2005, nominal pay increases varied between 17.4% in Latvia and 1.6% in Cyprus. Two countries recorded increases of 10% or over, while three experienced increases of 5%-10%, four increases of 2%-5%, and one an increase of less than 2%. The average increase stood at 6.7%. • The average pay increase in the 10 Nnew Member States thus considerably exceeded that in the ‘old’ EU (plus Norway) in both 2004 and 2005, and the differential grew from 2.5 percentage points to 3.0 points. In 2002, the average increase in the then accession countries (excluding the Czech Republic and Lithuania, for which no information was available) had stood at 6.5% - 3.0 points above the ‘old’ EU average, while in 2003 the differential had stood at 2.8 points. Overall, the apparent process of convergence of pay trends in the new Member States towards those in the old EU thus seems to have halted in 2005. • Despite the 1.1-point rise in the average wage increase in the new Member States between 2004 and 2005, the upward trend was by no means uniform, with the rate of increase falling in half of the 10 countries (Poland, Slovenia, Hungary, Slovakia and Cyprus). Much of the overall average increase was accounted for by major rises in Latvia and Estonia. Increases in Cyprus were at or below the EU 15 average in both years, while this was also true in Malta in 2004 and Slovenia in 2005. • In Bulgaria and Romania, nominal increases were considerably above the average for the new EU Member States in both 2004 and 2005, though declining in both cases.

EU 25

Considering the expanded EU 25 as a whole, the average agreed pay increases were 4.5% in 2005 and 4.1% in 2004, having stood at 4.2% in 2003 and 4.4% in 2002 (Czech Republic and Lithuania excluded), indicating a reversal in the previous steady downward trend in 2005. The inclusion of the new Member States has pushed the Union’s average increase upwards, and the differential between the EU 15 and EU 25 figure rose in 2005 to 1.5 percentage points, having previously narrowed slightly from 1.2 percentage points in 2003 to 1.1 points in 2004 (though much of the gap in 2005 is accounted for by the relatively high increases in the Baltic states).

Finally, the average increases for all 28 countries examined stood at 4.6% in 2005, rising to 4.8% in 2004.

Figure 1. Average collectively agreed pay increases, 2004 and 2005 (%)

s ic k e d a ia g s d ia in K s 5 e ) tria um ru l ce n aly n r lta n n a U e 1 n 4 i b n ec la It a a la ugal tri EU 0 lg yp u nland e u M t n le U -zo i r re Latvi h rland ma Sp u E (20 Aus C ep EstoniaF Fra G I it mbou e NorwayPo o Norwayro Be Bulgaria Hungary Por R SlovakiaSlovenia Sweden u R Denmar Germany L xe th d tes u e ll co Who n E ch L N A ze 5 a C 1 EU ember Sta M

New

2004 2005

The statistics in figure 1 should be read in conjunction with the notes in Appendix 1

Source: EIRO.

Real pay increases

Firgure 1 above refers to nominal pay increases. To indicate real pay increases, figure 2 below adjusts the increases for inflation, subtracting the annual rates of inflation for December 2003-December 2004 and December 2004-December 2005 respectively, as calculated by Eurostat, using the Harmonised Index of Consumer Prices (HICP).

Similar inflation figures are not available for Bulgaria and Romania, so national sources are used (National Statistics Institute and Institute of National Statistics respectively). For the EU 25 as a whole, 2004 saw inflation fall back slightly, from an average of 2.4% over December 2003-December 2004 to an average of 2.1% over December 2004-December 2005. The EU 15, however, experienced an unchanged rate of 2.2% in both years.

EU 15 and Norway

Looking first at the EU 15 and Norway, figure 2 indicates the following trends:

• Workers received real pay increases in all countries except Austria and Germany in 2004. In 2005, inflation again outstripped the nominal pay rise in Germany, and also in the Netherlands and Spain. • In 2004, real pay increases ranged between 2.9% in Greece (minimum rates laid down by intersectoral agreement) and -0.4% in Austria - a narrower range than found for nominal increases. Increases of 2% and over were recorded in five countries, increases of 1%-2% in three countries, increases of under 1% in six countries and decreases of up to -1% in two countries. The average increase stood at 1.1% (1.0% if Norway is excluded). • In 2005, the range of real pay increases was between 2.1% in Ireland and -1.3% in the Netherlands (where a wage freeze was in place) - a similar range to that in 2004 and less than

the range for nominal increases in 2005. Only two countries recorded increases of 2% and over, six countries recorded increases of 1%-2%, five recorded increases of 0%-1% and three had decreases of up to -1%. The average increase stood at 0.7% (the same figure applies to the EU 15 alone) • The average real increase thus fell by 0.4 percentage points from 2004 to 2005, compared with a decrease of only 0.1 point in nominal pay increases - indicating a greater degree of wage moderation in real terms. The fall in the rate of real increase continued a trend that began in 2004, following upward movement since 2001. The rate of real pay increase fell from 2004 to 2005 in 11 out of 16 countries (most notably in the Netherlands and Denmark), but rose in four (most notably in Austria and Italy) and remained unchanged in one. Over the five-year period 2001-5, there are few discernible trends in real pay increases across the countries considered, with most experiencing annual ups and downs (with a few exceptions, such as the downward trend since 2002 in Germany). In terms of the size of the variations in annual increases over 2001-5 - which tend to be considerably larger than for nominal pay increases - it seems that the countries with the greatest stability are Portugal and the UK (where the variation between the highest and lowest annual increases was 1 percentage point or less), while the least stable are Greece, Ireland and Norway (3 percentage points or more). • Averaging the annual real pay increases over the five-year period 2001-5, the 16 countries can be divided into: ‘negative’ real pay-increase countries - those where pay increases averaged below zero (the Netherlands and Spain); ‘low’ real pay-increase countries - those where pay increases averaged under 1% (Austria, Belgium, Denmark, Germany, Italy and Portugal); ‘medium’ real pay-increase countries - those where pay increases averaged 1%-2% (Finland, France, Greece, Ireland, Luxembourg, Sweden and the UK); and ‘high’ real pay-increase countries - those where pay increases averaged 2% or over (Norway).

Euro-zone

Taking only the countries of the euro-zone, the following picture emerges:

• In 2004, real pay increases ranged between 2.9% in Greece and -0.4% in Austria. Increases of 2% and over were recorded in three countries, increases of 1%-2% in one country, increases of under 1% in six countries and decreases of up to -1% in two countries. The average increase stood at 0.8% - lower than the overall EU 15/Norway average of 1.1%. • In 2005, real pay increases varied between 2.1% in Ireland and -1.3% in the Netherlands. Increases of 2% and over were recorded in two countries, increases of 1%-2% in three countries, increases of under 1% in four countries, and decreases of up to -1% in three countries. The average increase stood at 0.6%, again below the overall EU 15/Norway average of 0.7%. • The average real increase thus fell by 0.2 percentage points from 2004 to 2005 (a lower drop than the overall EU 15/Norway average), compared with a 0.1-point change in nominal pay increases. • These figures indicate that in 2004 and 2005 (as over 1998-2003) real pay increases were lower in the euro countries than in the EU 15/Norway more widely.

New Member States

Looking at the 10 new Member States, the main points are as follows:

• In 2004, real pay increases varied between 4.4% in Estonia and -1.4% in Cyprus. Increases of 2%-5% were recorded in three countries, increases of up to 2% in five countries and decreases in two countries. The average increase stood at 1.4%. • In 2005, real pay increases varied between 10.3% in Latvia and 0.1% in Malta. Increases of over 5% were registered in three countries, increases of 2%-5% in four countries and increases of up to 2% in three countries. The average increase stood at 3.6% • Eight of the individual countries followed the overall rise in the average real wage increase in the new Member States between 2004 and 2005, the only exceptions being Slovakia and Slovenia. However, the substantial scale of the overall rise was due largely to major increases in the Baltic states - Latvia, Estonia and, to a lesser extent, Lithuania. • The average real pay increase in the 10 new Member States thus exceeded that in the EU 15 (plus Norway) in both 2004 and 2005. The differential increased considerably, from 0.3 percentage points to 1.7 points. The gap had previously been narrowing since 2002, the first

year that EIRO started to include the new Member States. The 2005 leap may suggest that pay trends in some of the new States - and especially those in the Baltic - have yet to settle down in a pattern similar to that in the old EU. • Turning to the candidate countries considered, in 2004 real agreed pay increased faster than the new Member State average in both Bulgaria (considerably so) and Romania, but in 2005 the rate of increase in both countries fell below this average.

EU 25

With regard to the EU as a whole, the average collectively agreed pay increase, adjusted for inflation, stood at 1.1% in 2004 and 1.9% in 2005 (the 2003 figure was 1.8%). The inclusion of the new Member States thus pushed the Union’s average increase upwards by 0.1 points in 2004 and by 1.2 points in 2005, suggesting that real pay increase convergence may be running slightly ahead of nominal pay increase convergence.

Lastly, the average real increase for all 28 countries examined stood at 1.4% in 2004, climbing to 1.9% in 2005.

Figure 2. Average real increase in 2004 and 2005 (%)

y s y l ) a a rk ia d e r a g a a ia ia ia n 5 4 tri ri blic n n ny c a tvi ur d g n k n e UK EU 1 0 s a u o la a g land Italy a o n rw rway U 0 lg ma ree e Malta a o va ve Spain ed le Au Cyprus n st Francerm Ir L Polandortu o lo w o E BelgiumBu e E Fin e G N S No D G Hun Lithuania therl P Roma Sl S d uro-zones (2 e l countriesWh n E te -2 Luxemb N Al a r Sta Czech Rep 15 e EU mb Me w e N 2004 2005

Source: EIRO and Eurostat.

Collectively agreed pay increases by sector

Overview

Turning from the whole economy to individual sectors, this report provides figures below for collectively agreed pay increases in six sectors selected to represent manufacturing industry (metalworking and chemicals), services (banking and retail) and the public sector (local government and the central civil service). While these more specific figures are probably more accurate than the overall average increases given in the previous section, great caution is again advised in their use, and the notes in the appendices should be read carefully.

Various factors should be borne in mind when comparing the sectoral pay increase figures, often reflecting differences in national industrial relations systems. These include the following:

• the figures have been arrived at in a number of ways - usually the basic increase provided for in the most recent relevant sectoral agreement, but also in some cases through producing an average or mid-range of a number of settlements at company or local level (e.g. the UK, Bulgarian chemicals, Czech metalworking and chemicals or French metalworking); • the definitions of sectors, and the structure of sectoral bargaining, vary considerably from country to country, so is not always being compared with exact like; • the extent to which actual pay reflects the collectively agreed increases referred to, varies, with bonuses and additional payments of various sorts featuring more strongly in some countries than others; • pay rises are not always fully consolidated, with the use of one-off payments featuring in some cases (e.g. German local government and civil service). Furthermore, increases may be awarded as a fixed cash amount, which will result in a differing percentage increase in the pay of workers on differing wage rates (as in Finland and Slovenia, though there is a minimum percentage increase guaranteed) - in the case of Belgium, this has made it impossible to calculate percentage increases for most sectors; • automatic pay indexation may account for a considerable part of the pay increases recorded (as in Belgium and Luxembourg); • the relative roles of sectoral and company bargaining are an important factor, with the sectoral agreements referred to in countries like France, Italy and Denmark (most sectors) generally providing only for minima, with subsequent lower-level bargaining; • the dates when the various collective agreements, and the relevant pay increases, come into force vary considerably and rarely run from the beginning of the calendar year; • in some countries, multi-year agreements apply (as in Denmark, Finland, Ireland, Sweden or Bulgarian retail) with the pay increases not always being paid in equal fractions, distorting the annual figures; • only one category of workers may be referred to in the figures where bargaining occurs separately for blue- and white-collar workers (e.g. in Greek, Luxembourg and Norwegian metalworking); and • in local government and the civil service, the increases referred to in the figures are in some cases not determined by bargaining but imposed by law, as in Austria, Bulgaria, France, Poland, Portugal and Romania.

EU 15 and Norway

Comparing the six sectors, in 2004, the average nominal increase across the EU 15 and Norway stood at 3.2% in metalworking and local government (0.1 percentage points above the whole-economy average), 3.0% in retail and the civil service (0.1 points below the overall average) and 2.9% in chemicals and banking (0.2 points below the average). In 2005, the average increase in banking rose to 3.3% (0.3 points above the overall average), moving this sector into top place above metalworking. There the rise fell to 3.1% (0.1 points above average), whereas chemicals and retail noted 3.0% (the same as the overall average). The two parts of the public sector considered fell back sharply - to 2.3% in the civil service (0.7 points below average) and 2.2% in local government (0.8 points below average). Over the seven-year period 1999-2005, the average annual increase stood at 3.2% in the two manufacturing sectors considered (the same as the whole-economy average), 3.1% in the two services sectors and 2.9% in the two parts of the public sector. Over the whole period, pay in banking/retail and local government/civil service thus fell behind that in metalworking/chemicals and the economy more widely.

New Member States

In the new Member States, in 2004, the average nominal increase was highest in local government, at 5.2% (0.4 percentage points below the whole-economy average, although the latter is based on a larger number of countries), and the civil service, at 4.8% (0.6 points below the overall average). The public sector was followed by metalworking and chemicals, at 4.7% (0.9 points below the average), then the two service sectors - banking, at 4.1% (1.5 points below the average), and retail, at 4.0% (1.6 points below the average). In 2005, the public sector experienced a reverse, occupying the bottom places at 3.7% for local government (3.0 points below the overall average, although again the latter is based on a larger number of countries) and 3.6% for the civil service (3.1 points below the average). Metalworking moved up into top place, at 6.0% (0.7 points below the average) and banking into second, at 5.0% (1.7

points below the average). These were followed by chemicals, at 4.9% (1.8 points below the average), and retail, at 3.8% (2.9 points below the average). In 2004, the average increases in the new Member States exceeded those in the EU 15/Norway by between 2.0 percentage points in local government and 1.0 points in retail. In 2005, the gap ranged from 2.9 points in metalworking to 0.8 points in retail

EU 25

In the EU 25 as a whole, in 2004, the average nominal increase was 3.8% in local government (0.3 percentage points below the whole-economy average), 3.6% in metalworking and the civil service (0.5 points below the overall average), 3.5% in chemicals (0.6 points below the overall average), 3.3% in retail (0.8 points below the average) and 3.2% in banking (0.9 points below the average). In 2005, the rate of increase rose in the manufacturing sectors considered, putting metalworking in top place, at 4.0% (0.5 points below the overall average) and chemicals in second, at 3.8% (0.7 points below the average). These were followed by the two service sectors - 3.5% in banking (1.0 points below the overall average) and 3.2% in retail (1.3 points below the average). Increases fell back sharply in the public sector, with the increase in both local government and the civil service standing at 2.6% (1.9 points below the overall average).

In all sectors for which information is available, pay increases in Bulgaria and Romania were above the average for the new EU Member States. Those in Romania were very far above this level in most cases, while those in Bulgaria were generally nearer the new Member State norm.

Metalworking

In 2004, across the ‘old’ EU 15 and Norway (no data are available for Belgium - see note) nominal agreed pay increases in the metalworking sector ranged between 6.5% in Greece and 1.8% in the Netherlands - see figure 3 below. In 2005, the same two countries again occupied top and bottom position, at 6.5% and 1% respectively (no data are available for Belgium and France). The average pay increase in metalworking fell slightly from 3.2% in 2004 (the same figure if Norway is excluded) to 3.1% in 2005 (3.0% for the EU 15 only) - in both years slightly above the whole-economy average (see figure 1 above). The rate of increase fell between 2004 and 2005 in six countries (most sharply in Italy), rose in five (most notably in Germany and the UK) and remained unchanged in three (as noted, data are not available for both years for Belgium and France).

In 2004, the increase in metalworking was equal to the national average increase for all sectors in six countries, higher in five countries (most notably in Greece, the Netherlands and Norway) and lower in three countries (most notably in Luxembourg and Spain). In 2005, the increase in metalworking was equal to the national average increase for all sectors in five countries, higher than average in five countries (most notably in Germany) and lower in four (most notably in Italy).

The average EU 15/Norway metalworking increases of 3.2% in 2004 and 3.1% in 2005 compare with increases of 2.9% in 2003, 3.5% in 2002, 3.6% in 2001, 3.4% in 2000 and 2.9% in 1999. There would thus not appear to have been any clear trend in recent years.

With regard to the new Member States, no data on collectively agreed increases in metalworking are available for Latvia, Lithuania, Malta (where the sector does not exist) and Poland. Among those countries for which information is available, the average nominal increase in the sector stood at 4.7% in 2004 and 6.0% in 2005 - above the EU 15/Norway averages in both years, and with a wider differential in 2005. In 2004, the highest increase was recorded in Estonia (8.4%, though this figure refers to wages generally, rather than agreed pay) and the lowest in Cyprus (2.0%). In 2004, Estonia (14.4%) and Cyprus (2.0%) again occupied the highest and lowest positions. The rate of increase rose between 2004 and 2005 in three countries (most sharply in Estonia), remained stable in two and fell only in Slovenia. In 2004, the increase in metalworking was higher than the national average increase for all sectors in one country, equal to the average in one and lower in four. However, in 2005, the metalworking increase was higher than the national average increase in three countries, equal to the average in two countries and lower in one.

Considering the EU 25, the average pay increase in metalworking rose from 3.6% in 2004 to 4.0% in 2005. This was 0.4 percentage points higher than the EU 15 average in 2004 but 1.0 points higher in 2005.

The average pay increase in metalworking in all the countries considered was 5.3% in 2004 and 5.4% in 2005. This reflects the fact that rises in Bulgaria and Romania were high - over five times the EU 25 average - in both years.

Figure 3. Average collectively agreed pay increases in metalworking, 2004 and 2005 (%)

a c k ia d y ry ly s y ia a n K s ri n n a a a n ki e U e a prus a an g It ourg rw d tri 004) lg y m n b o rtugal va Spain n 2 Austria C epubli inl France u Ireland rland ma o we u ole EU Bu Esto F Greece e N o S h Norways ( R Denmar Ger H th Po R Sl Slovenia d e ll co W n ch Luxem N A ze 5 a C 1 EU

New Member State

2004 2005

Notes on averages: ‘all countries’ is for 23 countries in 2004 and 22 countries in 2005; ‘whole EU’ is for 20 countries in 2004 and 19 countries in 2005; ‘EU 15 and Norway’ is for 15 countries in 2004 and 14 countries in 2005; ‘new Member States’ is for six countries.

The data in figure 3 should be read in conjunction with the notes in Appendix 2.

Source: EIRO.

Chemicals

In 2004, the range of nominal pay increases awarded in the chemicals sector across the EU 15 and Norway (no data are available for Belgium - see note below) was between 6.5% in Greece and zero in Portugal (where no sectoral collective agreement was concluded in either 2004 or 2005) - see figure 4 below. In 2005, the range of increases was between 6.0% and zero, again in Greece and Portugal (no data are available for Belgium). The average pay increase rose slightly from 2.9% in 2004 (the figure is the same for the EU 15 only) - slightly below the whole-economy average figure (see figure 1 above) - to 3.0% in 2005 (the same as for the EU 15 only) - the same as the whole-economy average. The rate of increase rose between 2004 and 2005 in seven countries (most sharply in Germany), fell in three (most notably in Spain) and remained unchanged in five (as noted, data is not available for Belgium).

In 2004, the increase in the chemicals sector was lower than the national average increase for all sectors in seven countries (most notably in Portugal), higher in four countries (most notably in Italy) and the same in four countries. In 2005, the increase was lower than the national average increase for all sectors in six countries (again most notably in Portugal), equal to the average in four countries and higher in five countries (most notably in the Netherlands).

The EU 15/Norway average chemicals increases of 2.9% in 2004 and 3.0% in 2005 compare with increases of 3.2% in 2003, 3.4% in 2002, 3.6% in 2001 and 3.0% in both 1999 and 2000. After the sharp increase in 2001, the trend was thus downwards until 2005, when there was a slight rise.

Turning to the new Member States, no data on collectively agreed increases are available for Latvia, Lithuania and Poland, or for Cyprus in 2005. The average nominal increase in chemicals stood at 4.7 % in 2004 and 5.7% in 2005 - above the EU 15/Norway averages in both years, with a wider differential in 2005 (though the 2005 average is of a lower number of countries). In 2004, the highest increase was recorded in Estonia (8.4%, though this figure refers to wages generally, rather than agreed pay) and the lowest in Malta (2.5%). In 2005, Estonia again headed the list (14.4%) and Malta was again at the bottom (2.3%). The rate of increase fell between 2004 and 2005 in three countries, rose in two and remained the same in one. In 2004, the increase in chemicals was equal to the national average increase for all sectors in one country, higher in two countries and lower in four countries. In 2005, the increase in chemicals was higher than the national average increase in two countries, lower in three countries and the same in one country.

With regard to the EU 25, the average pay increase in chemicals rose from 3.5% in 2004 to 3.8% in 2004. This was 0.6 percentage points higher than the EU 15 average in 2004 and 0.8 points higher in 2005.

The average pay increase in chemicals in all the countries considered (i.e. the EU, Norway, Bulgaria and Romania) was 3.9% in 2004 and 4.1% in 2005.

Figure 4. Average pay increase in chemicals, 2004 and 2005 (%)

a s a d s a a y ) ri i n ny ce ia i K a 4 a ru ark n a a e k n U ries w 0 g m o l gary Italy tugal eden t yp n st in rm n Malta rland r mani va ve Spain n or 20 Austria ul C e E F Francee Gre u Ireland e Norway o o o w u ole EUN ( B H Po R Sl Sl S s D G th l co Wh te e l a Luxembourg N A and r St Czech Republic e EU 15 mb e M w e N

2004 2005

Notes on averages: ‘all countries’ is for 24 countries in 2004 and 23 countries in 2005; ‘whole EU’ is for 21 countries in 2004 and 20 countries in 2005; ‘EU 15 and Norway’ is for 15 countries; ‘new Member States’ is for seven countries in 2004 and six countries in 2005.

The data in figure 4 should be read in conjunction with the notes in Appendix 3.

Source: EIRO.

Banking

In 2004, the range of nominal pay increases awarded in the banking sector across the EU 15 and Norway (no data is available for Belgium) was between 4.5% in Ireland and 0.5% in Finland (though this figure refers to minimum increases) - see figure 5 below. In 2005, the range of increases grew, with the highest pay rise being recorded in Norway, at 7.7%, and the lowest again in Finland at 0.6%. The average pay increase rose from 2.9% in 2004 (2.8% excluding Norway) - 0.2 percentage points below the whole-economy average figure (see figure 1 above) - to 3.3% in 2005 (2.9% excluding Norway) - 0.3 points above the whole-economy average. The rate of increase rose between 2004 and 2005 in eight countries (most sharply in the Norway), fell in six (most notably in the Netherlands) and remained unchanged in one (as noted, data is not available for Belgium).

In 2004, the increase in banking was lower than the national average increase for all sectors in eight countries (most notably in Italy), higher in four countries (most notably in the Netherlands) and equal to the average in three countries. In 2005, the increase in banking was lower than the national average increase for all sectors in only five countries (most notably in Finland), equal to the average in three countries and higher in seven countries (most notably in Norway).

The average EU 15/Norway agreed pay increases in the banking sector of 2.9% in 2004 and 3.3% in 2005 followed increases of 2.9% in 2003, 3.4% in 2002, 3.6% in 2001, 3.3% in 2000 and 2.6% in 1999.

As for the new Member States, no data on collectively agreed increases are available for the Czech Republic, Latvia, Lithuania and Poland, or Estonia in 2005. Among the countries for which information is available, the average nominal increase in banking stood at 4.1% in 2004 and rose to 5.0% in 2004 - higher than the EU 15 banking average by 1.3 percentage points in 2004 and 2.1 points in 2005. In 2004, the highest increase was recorded in Hungary (9.1%) and the lowest in Malta (1.2%). In 2005, by contrast, Malta noted the greatest increase (9.7%), while Cyprus had the lowest (0.6%). The rate of increase fell between 2004 and 2005 in three countries, remained stable in one and rose in one (Malta). In 2004, the increase in banking was below the national average increase for all sectors in all the countries concerned except one (Hungary). In 2005, the banking increase was at or above the national average increase in three countries and lower in two.

Considering the EU 25, the average pay increase in banking rose from 3.2% in 2004 to 3.5% in 2005. This was 0.4 percentage points higher than the EU 15 banking average in 2004, with the gap rising slightly to 0.6 points in 2005.

The average pay increase in banking in all the countries considered was 4.1% in 2004 and 6.0% in 2005. With no figures available for Bulgaria, the difference from the EU figure is due to major rises in Romania - especially the massive increase in 2005, which was around five times higher than Romania’s whole- economy average rise in that year.

Figure 5: Average collectively agreed pay increases in banking, 2004 and 2005 (%)

0 l d y ry d ly y ia a ia in n s y n ce ce a n a ds a n ki n a e UK e a ark a n an e g la It n uga d tri w m n Malta a rw t va ve Sp n Austria inl rm u Ire rl o ma o o u ole EU or Cyprus Estonia F Fra Gre e N o Swe N Den Ge H h Por R Sl Sl ll co Wh Luxembourg Net A and 15 U E

New Member States (2004)

2004 2005

Notes on averages: ‘all countries’ is for 22 countries in 2004 and 21 countries in 2005; ‘whole EU’ is for 20 countries in 2004 and 19 countries in 2005; ‘EU 15 and Norway’ is for 15 countries; ‘new Member States’ is for six countries in 2004 and five countries in 2005.

The data in figure 5 should be read in conjunction with the notes in Appendix 4.

Source: EIRO.

Retail

In 2004, the range of nominal pay increases awarded in the retail sector across the EU 15 and Norway (no data is available for Belgium - see note below) was between 6.6% in Greece and 1.6% in the Netherlands - see figure 6 below. In 2005, the top and bottom places were again occupied by same two countries, with the range increasing slightly to 6.0%-0.5%. The average pay increase remained stable at 3.0% in both years (though it fell to 2.9% in 2005 if Norway is excluded) - 0.1 percentage points below the whole-economy average figure (see figure 1 above) in 2004 but at the same level in 2005. The rate of increase rose between 2004 and 2005 in six countries (most sharply in Italy), fell in four (most notably in the Netherlands) and remained unchanged in five (as noted, data is not available for both years for Belgium).

In 2004, the increase in retail was lower than the national average increase for all sectors in eight countries (most notably in France), higher in four countries (most notably in Greece) and equal to the average in three countries. In 2005, the retail increase was lower than the national average increase for all sectors in seven countries (most notably in Austria and Luxembourg), equal to the average in three countries and higher in five countries (most notably in Italy).

The EU 15/Norway average agreed pay increases in the retail sector of 3.0% in both 2005 and 2004, followed increases of 2.8% in 2003, 3.6% in both 2002 and 2001, 3.0% in 2000 and 2.8% in 1999.

With regard to the new Member States, no data on collectively agreed increases are available for Latvia, Lithuania and Poland, or for Czech Republic and Estonia in 2005. Among the countries for which

information is available, the average nominal increase in retail stood at 4.0% in 2004, falling to 3.8% in 2005 (when the average was of a smaller number of countries) - 1.0 percentage point above the EU 15 average in 2004 and 0.9 points in 2005. In 2004, the highest increase was registered in the Czech Republic (6.9%) and the lowest in Malta (2.5%). In 2005, Hungary had the greatest increase (6.0%, though this is a guideline figure) and Slovenia the lowest (2.7%). The rate of increase fell between 2004 and 2005 in two countries, rose in two and remained stable in one. In 2004, the increase in retail was below the national average increase for all sectors in four country and higher in three. In 2005, the retail increase was lower than the national average increase in three countries, higher in one and the same in one.

Taking the EU 25 as a whole, the average pay increase in retail fell from 3.3% in 2004 to 3.2% in 2005. This was 0.3 percentage points higher than the EU 15 retail average in both years.

The average retail pay increase in all the countries considered (i.e. the EU, plus Norway, Bulgaria and Romania) was 3.7% in 2004, falling to 3.6% in 2005.

Figure 6: Average collectively agreed pay increases in retail, 2004 and 2005 (%)

2004 2005

Notes on averages: ‘all countries’ is for 24 countries in 2004 and 22 countries in 2005; ‘whole EU’ is for 21 countries in 2004 and 19 countries in 2005; ‘EU 15 and Norway’ is for 15 countries; ‘new Member States’ is for seven countries in 2004 and five countries in 2005.

The data in figure 6 should be read in conjunction with the notes in Appendix 5.

Source: EIRO

Local government

In 2004, the range of nominal pay increases awarded in the local government sector across the EU 15 and Norway (no data is available for Belgium in either year or for France in 2005) was between 11.5% in Greece and zero in the Netherlands (i.e. a pay freeze) - see figure 7 below. In 2004, the range of increases was much narrower, with Ireland again recording the highest pay rise, at 5.3%, and with three countries having a zero increase - Germany (though workers here did receive a lump-sum payment), Italy and the Netherlands. The average pay increase fell from 3.2% in 2004 (the same figure as for the EU 15 only) - 0.1 percentage points above the whole-economy average figures (see figure 1 above) - to only 2.2% in 2004 (2.1% excluding Norway) - 0.8 points below the whole-economy average. The rate of increase fell between 2004 and 2005 in nine countries (most sharply in Ireland) and rose in four

In 2004, the increase in local government was below the national average increase for all sectors in 10 countries (most notably in Greece), higher in only four (most notably in Ireland) and at the same level in one. In 2005, the increase in local government was lower than the national average increase for all sectors in 11 countries (most notably in Italy), equal to the average in one country and higher in just two countries (most notably in Ireland).

The average EU 15/Norway increases in local government of 2.2% in 2005 and 3.2% in 2004 followed increases of 2.8% in 2003, 3.2% in both 2002 and 2001, 3.0% in 2000 and 2.7% in 1999. The 2005 increase was thus the lowest since EIRO started compiling records, and the fall from 2004 to 2005 the largest year-on-year change over this period.

In the new Member States, no data is available for Latvia, Lithuania, Malta and Poland, or for Estonia in 2005. Among those countries for which information is available, the average nominal increase in local government stood at 5.2% in 2004 and 3.7% in 2005 (an average based on a smaller number of countries) - 2.0 percentage points above the EU 15 average in 2004, but only 1.6 points higher in 2005. In 2004, the highest increase was in Estonia (8.2%) and the lowest in Cyprus (zero). In 2005, Hungary headed the list (6.0%) and Cyprus again was last (zero). The rate of increase fell between 2004 and 2005 in three countries and remained stable in two. In 2004, the increase in local government was below the national average increase for all sectors in four countries, higher than average in one and lower in one. In 2005, the increase in local government was lower than the national average increase in three countries, higher in one country and equal in one.

Considering the EU 25, the average pay increase in local government fell from 3.8% in 2004 to 2.6% in 2005. This was 0.6 percentage points higher than the EU 15 local government average in 2004 but only 0.5 points higher in 2005.

The average pay increase in local government in all the countries considered was 4.5% in 2004 and 3.7% in 2005. High increases in Romania in both years account for most of the difference from the EU 25 average, though increases in Bulgaria were also above average.

Figure 7: Average collectively agreed pay increases in local government, 2004 and 2005 (%)

New Member State

2004 2005

Notes on averages: ‘all countries’ is for 23 countries in 2004 and 21 countries in 2005; ‘whole EU’ is for 20 countries in 2004 and 18 countries in 2005; ‘EU 15 and Norway’ is for 15 countries in 2004 and 14 countries in 2005; ‘new Member States’ is for six countries in 2004 and five countries in 2005.

The data in figure 7 should be read in conjunction with notes in Appendix 6.

Source: EIRO.

Civil service

In 2004, the range of nominal pay increases in the central civil service sector across the EU 15 and Norway was from 12.6% in Greece to 0.1% in the Netherlands - see figure 8 below. In 2005, the range of increases was much narrower, with Ireland again recording the highest pay rise, but at only 5.8%, and zero increases registered in Germany, Italy and the Netherlands. The average pay increase fell quite sharply from 3.0% in 2004 (the same figure as for the EU 15 only) - 0.1 percentage points below the whole-economy average figures (see figure 1 above) - to 2.3% in 2005 (2.1% excluding Norway) - 0.7 points below the whole-economy average. The rate of increase fell between 2004 and 2005 in eight countries (most sharply in Ireland), rose in six (most notably in France) and remained unchanged in two.

In 2004, the pay increase in the civil service was below the national average increase for all sectors in nine countries (most notably in France), at the same level in two, and higher in five (most notably in Ireland). In 2005, the number of countries where the increase in the civil service was lower than the national average increase rose to 12 (most notably Italy), while the increase was equal to the average in one country and higher in three (most notably in Ireland).

The average EU 15/Norway increases in the civil service of 2.3% in 2005 and 3.0% in 2004 followed increases of 2.8% in 2003, 3.2% in both 2002 and 2001, 3.0% in 2000 and 2.7% in 1999. The 2005 rise was thus the lowest since EIRO started collecting data, and the fall from 2004 to 2005 the largest year- on-year change over this period.

With regard to the new Member States, no data is available for Latvia, Lithuania and Malta, or for Estonia in 2005. Among the countries for which information is available, the average nominal increase in the civil service stood at 4.8% in 2004 and 3.6% in 2005 (an average of fewer countries) - 1.8 percentage points above the EU 15 average in 2004, falling to 1.5 points above in 2005. In 2004, the highest increase was recorded in Estonia (8.2%) and the lowest in Cyprus (zero). In 2005, Hungary had the greatest increase (6.0%) and Cyprus again the lowest (zero). The rate of increase fell between 2004 and 2005 in three countries and remained stable in three. In 2004, the increase in the civil service was below the national average increase for all sectors in five countries, the same in one country and higher in one. In 2005, the increase in the civil service was lower than the national average increase in four countries, equal in one country and higher than one.

As for the EU 25, the average pay increase in the civil service fell from 3.6% in 2004 to 2.6% in 2005. This was 0.6 percentage points higher than the EU 15 civil service average in 2004, falling to 0.5 points in 2005.

The average pay increase in the civil service in all the countries considered was 4.2% in 2004 and 3.6% in 2005. High increases in Romania in both years account for most of the difference from the EU 25 average, though increases in Bulgaria were also above average.

Figure 8: Average collectively agreed pay increases in the civil service, 2004 and 2005 (%)

a a d e d s d a n y ) m ri rk n d n i i K U a 4 iu a a nc a n a gal n a U ries E 0 g g prus gary Italy p t e rw 0 ustri l y nm nlan rmany n rel rla ol rtu ma vakia S n l o A ul C epublice EstoniaFi Fra e Greeceu I NorwayP o o u o (2 Be B R H embourg Po R Sl Slovenia Sweden N s D G x the l co Wh d te u e l a L N A an t 5 S r Czech 1 e U E mb e M w e n

2004 2005

Notes on averages: ‘all countries’ is for 25 countries in 2004 and 24 countries in 2005; ‘whole EU’ is for 22 countries in 2004 and 21 countries in 2005; ‘EU 15 and Norway’ is for 16 countries; ‘new Member States’ is for seven countries in 2004 and six countries in 2005.

The data in figure 8 should be read in conjunction with the notes in Appendix 7.

Source: EIRO.

Minimum wages

Twenty of the 28 countries considered in this report have a national minimum wage, set either by law or by a national intersectoral agreement (Cyprus has a system of statutory minimum wages that applies to only six specific occupations - sales staff, clerical workers, auxiliary healthcare staff and auxiliary staff in nursery schools, crèches and schools - and is not included in this group). Figure 9 below provides data on the increases in the minimum wage in 2004 and 2005 for these countries. These minimum wages are generally increased through political and/or social partner decisions, plus some kind of indexation mechanism in some countries.

Taking the nine ‘old’ EU Member States concerned, the highest minimum wage increases in both years were in Ireland, at 10.0% in 2004 and 9.0% in 2005, and the lowest in the Netherlands, at zero in 2004 and 2005. The overall average rate of increase fell from 4.9% in 2004 to 3.8% in 2005 (the average had been 3.5% in both 2003 and 2002, 4.9% in 2001, 2.8% in 2000, 2.9% in 1999 and 2.6% in 1998). The average increase in minimum wages was thus markedly higher than the average increase in collectively agreed wages in 2004, but less so in 2005, with an overall downward trend (particularly in Spain, the UK and France) in contrast to the stability in agreed wages. At national level, increases in the minimum wage lagged behind the average collectively agreed increases in pay in 2004 in Luxembourg, Portugal, the Netherlands and, most notably, Belgium, while they exceeded the agreed increase in France, Spain, the UK and, most markedly, Ireland. In 2005, the increase in the minimum wages was lower than the average increases in Belgium (where the gap was greatest) the Netherlands and Portugal and exceeded them to a notable extent in Ireland, Luxembourg, Spain and the UK.

All the New Member States, apart from Cyprus (see above), have a national minimum wage. In 2004, the highest increase, at 14.8%, was found in Estonia, while the lowest, 1.4%, was in Malta. In 2005, the greatest rise was in Lithuania, at 10.0%, while the minimum wage was frozen in Latvia. The average increase fell sharply from 7.9% in 2004 to 5.5% (having stood at 8.4% in 2003). At national level, increases in the minimum wage lagged behind the average collectively agreed increases in pay in 2004 in Hungary, Malta, Poland, Slovakia and, most notably, Lithuania, while they exceeded the agreed increase in the Czech Republic, Latvia, Slovenia and, most markedly, Estonia. In 2005, the increase in the minimum wages lagged behind average increases in Estonia, Latvia (where the gap was greatest), Lithuania, Malta and Poland and exceeded them to a notable extent in the Czech Republic, Hungary and Slovenia. The differential between the EU 15 on the one hand and the new Member States on the other was only slightly higher for minimum wage increases than for collectively agreed wage increases in 2004, but widened considerably in 2005.

Across all 18 countries of the expanded EU that have a minimum wage, the average increase fell from 6.4% in 2004 to 4.7% in 2005 (5.9% in 2003). Including Bulgaria and Romania, their relatively high increases push the average rise up to 6.8% in 2004 and 6.0% in 2005 (though it should be noted that the absolute level of the minimum wage in these countries is very low by EU standards - see table 10 below).

Figure 9: Increase in national minimum wage for adults, 2004 and 2005 (%)

l ) m lic ia e ry a ta a a K s 5 4 b n l ds g ki U e 1 0 iu u o ec land tvia ourg a n u tri lg p re a b M la t va Spain n U 20 st France Ire L huani r Poland or o u E ( Be Bulgaria E G t P Re Hunga Li RomaniaSl Slovenia es h ll co Whole EU t Luxem Nethe A Sta Czec

ember M

New

2004 2005

Notes on averages: ‘all countries’ is for 20 countries; ‘whole EU’ is for 18 countries; ‘EU 15’ is for nine countries; ‘new Member States’ is for nine countries.

The statistics in figure 9 should be read in conjunction with notes in Appendix 8.

Source: EIRO.

Table 10 below provides the actual rates - hourly, monthly etc, as relevant - of national minimum wages in national currency in 2004 and 2005, See the notes to figure 9 for the dates from which rates applied (if there was more than one increase in the year, the rate given in the figure is that after the final one).

Overview of the existing rates for minimum wages in the countries where they exist for 2004 and 2005 given in national currencies and converted to euros where applicable

Table 10: National minimum wage for adults, 2004 and 2005, in national currency (gross wage) Country Rate of wage 2004 2005 Belgium Monthly EUR 1,210 EUR 1,234 Hourly BGN 0.71 (EUR 0.36) BGN 0.89 (EUR 0.46) Bulgaria Monthly BGN 120 (EUR 61.43) BGN 150 (EUR 76.70) Hourly CZK 39.60 (EUR 1.24) CZK 42.50 (EUR 1.43) Czech Republic Monthly CZK 6,700 (EUR 210.09) CZK 7,185 (EUR 241.25) Hourly EEK 14.60 (EUR 0.93) EEK 15.90 (EUR 1.02) Estonia Monthly EEK 2,480 (EUR 158.50) EEK 2,690 (EUR 171.92) Hourly EUR 7.61 EUR 8.03 France Monthly EUR 1,286.09 EUR 1,357.07

Daily EUR 25.01 EUR 26.41 Greece Monthly EUR 559.98 EUR 591.18 Hourly HUF 305.00 (EUR 1.21) HUF 328.00 (EUR 1.32) Daily HUF 2,440 (EUR 9.70) HUF 2,624 (EUR 10.58) Hungary Weekly HUF 12,000 (EUR 47.68) HUF 13,120 (EUR 52.89) Monthly HUF 53,000 (EUR 210.60) HUF 57,000 (EUR 229.79) Ireland Hourly EUR 7.00 EUR 7.65 Hourly LVL 0.474 (EUR 0.71) LVL 0.474 (EUR 0.68) Latvia Monthly LVL 80 (EUR 120.26) LVL 80 (EUR 114.90) Hourly LTL 2.95 (EUR 0.85) LTL 3.28 (EUR 0.95) Lithuania Monthly LTL 500 (EUR 144.81) LTL 550 (EUR 159.29) Hourly EUR 8.31 EUR 8.69 Luxembourg Monthly EUR 1,438.01 EUR 1503.42 Malta Weekly MTL 53.88 (EUR 125.89) MTL 55.63 (EUR 129.40) Netherlands Monthly EUR 1,264.80 EUR 1,264.80 Poland Monthly PLN 824 (EUR 182.03) PLN 849 (EUR 211.04) Portugal Monthly EUR 365.60 EUR 374.70 Hourly RON 1.647 (EUR 0.41) RON 1.823 (EUR 0.50) Romania Monthly RON 280 (EUR 69.12) RON 310 (EUR 85.61) Hourly SKK 37.40 (EUR 0.93) SKK 39.70 (EUR 1.03) Slovakia Monthly SKK 6,500 (EUR 162.41) SKK 6,900 (EUR 178.76) Slovenia Monthly SIT 117,500 (EUR 491.45) SIT 122,600 (EUR 511.75) Daily EUR 16.36 EUR 17.10 Spain Monthly EUR 490.80 EUR 513.00 UK Hourly GBP 4.85 (EUR 7.14) GBP 5.05 (EUR 7.39)

Conversions into EUR, where necessary (using average exchange rates for 2004 and 2005 from European Central Bank)

Source: EIRO.

The rates in table 10 should be read in conjunction with the notes to figure 9 (Appendix 8 , plus the following:

• Belgium: rates given apply to workers aged 21 and above; workers aged 21.5 and above with 6-12 months’ service and over 12 months’ service receive higher rates. • France: see note to figure 9 for meaning of rate given; monthly rate based on 169 hours. • Netherlands: figure is gross rate - net rates were EUR 1,051.00 in 2004 and EUR 1,045.00 in 2004. • Romania: figures are gross rates.

Youth rates

The minimum wage increases and rates examined above are the full adult rates. However, 10 countries apply lower rates to younger or less experienced workers. Brief details are provided in table 11 below.

An overview by countries showing the differences in pay in 2005 for younger workers and those who are still in training or have just started a job

Table 11: National minimum wages of younger and less experienced workers, 2005 % of full Country Applicable to rate 94% Workers aged 20

Belgium (see note to table 10 88% Workers aged 19 above for details of additional 82% Workers aged 18 rates based on age/experience) 76% Workers aged 17 70% Workers aged 16 and younger 90% Workers aged 19-21 in first six months of employment Czech Republic 80% Workers aged 18 and younger Workers aged 18 and over in second year of employment /workers aged over 18 and undergoing final third (lasting 90% one month to one year) of a course of authorised training or study Workers aged 18 and over in first year of employment/workers aged over 18 and undergoing 80% Ireland second third (lasting one month to one year) of a course of authorised training or study Workers aged over 18 and undergoing first third (lasting 75% one month to one year) of a course of authorised training or study 70% Workers under 18. Special Workers aged 15-18, who may only work up to 35 hours a Latvia hourly week rate 80% Workers aged 17 Luxembourg 75% Workers aged 15 and 16 94.77% Workers aged 17 Malta* 92.58% Workers aged under 17 85% Workers aged 22 72.5% Workers aged 21 61.5% Workers aged 20 52.5% Workers aged 19 Netherlands 45.5% Workers aged 18 39.5% Workers aged 17 34.5% Workers aged 16 30% Workers aged 15 90% Second year of employment Poland 80% First year of employment 75% Workers aged 16-18 Slovakia Workers under 16 (and workers with disabilities aged 16- 50% 18) ‘Development rate’ for workers aged 18-21 inclusive, plus workers aged 22 and older during first six months in a 84.16% UK** new job with a new employer and who are receiving accredited training 59.40% Workers aged 16 and 17, other than apprentices

* In 2004, the percentages were 94.6% for workers aged 17 and 92.34% for workers under 17 - relative value increased by higher 2005 increases in rates for younger workers.

** In 2004, the percentage was 84.53% for the development rate - the difference to the full rate was increased in 2005 by a higher increase for the adult rate than for the development rate; in 2004 the rate was 61.86 % for workers aged 16 and 17 - the differential with the full rate widened because the latter was increased in 2005, while the 16-17 rate was not.

Source: EIRO.

Gender pay differentials

The explicit pay terms of the collective agreements and minimum wage laws considered above are presumably gender neutral - they do not provide for differing pay rates or increases for women and for men (to do so would, of course, breach EU and national law on equal pay). However, the fact remains that women in all the countries examined here earn, on average, less than men. Figure 12 below indicates this gender pay gap by showing women’s average pay - hourly unless otherwise specified - as a percentage of men’s.

In the EU 15 and Norway, the gender wage gap is widest in Germany (at 26%) and narrowest in Luxembourg (at 10.1%). Other countries with a notably narrow gender wage differential include Ireland, France, Norway and Sweden, while those with a comparatively wide gap include Greece, Finland, Portugal, Spain and the Netherlands. The gender wage gap averages 18.1% across the EU 15 and Norway - a slight increase from the 17.4% found in the 2004 review of the data, but lower than the 18.6%, 19.2% and 20.4% found in the 2003, 2002 and 2001 reviews. Yearly upward and downward variations seem to be a feature of gender pay statistics, and the increase is unlikely to be significant over such a short period, while some variations in the figures are explained by changes in the source/nature of the data used. Where individual country data is available for several years, it often show small decreases in the gender pay gap - as in Austria, Denmark, France, Ireland and the UK. However, slight moves in the opposite direction can be seen in Belgium, the Netherlands and Sweden.

In the new Member States, the gender wage gap is widest in the Czech Republic (at 25.1%) and narrowest in Malta (at 4.0%). Other countries with a notably narrow gender wage differential include Slovenia, Hungary and Lithuania, while those with a comparatively wide gap include Cyprus, Slovakia and Estonia. With the reservations noted above, the gap appears to be narrowing at present in countries such as the Czech Republic, Estonia and Lithuania. The average differential in the new Member States stands at 17.1% (down from 17.4% in our 2004 review) - one percentage point narrower than in the EU 15 and Norway.

The average gender wage gap in the expanded EU 25 stands at 17.8% (17.5% in our 2004 survey), and across all 28 countries examined at 17.5% (17.3%).

While the above figures provide a broad picture of the situation, differences in calculation methods between countries highlighted in the notes for figure 12 should be noted.

A figure showing the differences in pay for men and women, given as percentages for the latest available figures.

Figure 12: Women’s average pay as a percentage of men’s, latest figures

120

100

* a c * * d * * * * * * * y * ** i li a* ** ry n a ia y ** ** *** n K a m rus b rk* i d y* a y** vi n lta a l* e U p u a n n n g la l t a rg** a ands a nia* in d w tria* lgar p to la ce** n ta a u u l rw a a or u Cy e nm n Francema e u Ire I L M o land EU 15 B e Es i r H th er N o Sp N Aus R F e Li h P Slovakia* Swe countries d Belgiu h D G Gre Portug Rom Slovenia** l Wholen EU Euro-zone ec Net Al a z 5 C Luxembo 1 U E mber States (2004) e

New M

Notes: figures are for 2005 except * 2004, ** 2003, *** 2002, figures refer to average hourly pay unless indicated otherwise in the notes in Appendix 9.

Source: EIRO.

Average earnings

Above, this report examined collectively agreed pay increases in 2004-5, based mainly on the contents of agreements. A clearer indication of the actual development of workers’ incomes is provided by earnings figures, which are usually based on a survey of individuals’ earnings and include elements such as bonuses and overtime pay. Figure 13 below provides data from national sources on increases in average earnings in 2004 and 2005 (figures are not available for 2004 for Austria, Denmark, the Netherlands and Portugal, and some 2005 figures are only partial). Once again, extreme caution is advised and the notes in the appendix to the figure should be read closely. The nature of the statistics and the definitions of earnings vary considerably from country to country, and in some cases (such as Belgium), the figures cover only particular groups of workers.

In the EU 15 and Norway, the range of average earnings increases in 2004 was between 4.6% in the UK and 0.1% in Germany. The two countries were again at the extremes in 2005 but with a narrower range - between 3.9% in the UK and 0.5% in Germany. The average rate of increase across these countries fell from 2.9% in 2004 to 2.7% in 2005 (though the 2005 average is of fewer countries). This continued a downward trend - the figure had stood at 3.4% in 2003, 3.9% in 2002 and 4.3% in 2001 (having previously risen since 1998). This reflects to some extent (if by no means exactly) the tendency already noted for average collectively agreed pay. The average earnings increase fell from 2004 to 2005 in eight countries (most sharply in Spain), remained stable in two and rose in only two (Belgium and Germany).

When compared with the data for collectively agreed pay increases, the earnings figures help to iron out to some extent the distortions caused by factors such as the fact that the relevant collective agreements in some countries provide only for minima, or varying levels of bargaining coverage. Increases in earnings are thus appreciably higher than agreed pay increases in cases such as Denmark, Finland,

Sweden and the UK, and lower in countries such as Germany, Greece, Italy, Luxembourg and Spain. Overall, the average increases in earnings are slightly lower than agreed pay increases.

In the countries of the euro-zone, the average increase in earnings was slightly lower than that in the whole EU 15 and Norway in both 2004 and 2005.

In the 10 new Member States, the range of average earnings increases in 2004 was between 10.2% in Slovakia and 0.5% in Malta, while in 2005 the range was somewhat wider, between 17.4% in Latvia and 1.4% in Malta. The average rate of increase across these countries rose from 6.4% in 2004 to 7.7% in 2005 (having stood at 7.1% in 2003) - an opposite trend to that in the EU 15. The upward tendency was by no means uniform: the rate rose between 2004 and 2005 in six countries (most notably in the Baltic states) but fell in four (most sharply in Slovakia and Poland). The average increase was 2.2 times higher than that in the EU 15 and Norway in 2004, rising to 2.9 times higher in 2005.

In the EU 25 as a whole, average earnings increased by 4.3% in 2004 and 5.1% in 2005. The inclusion of the new Member States thus pushes the Union’s average increase upwards, and this differential widened from 1.4 percentage points in 2004 to 2.4 points in 2005.

Considering all the countries examined, the average increase stood at 5.2% in 2004 and 5.7% in 2005, with substantial rises in Romania in both years (though falling from 2004 to 2005) accounting for most of the differential with the EU.

Figure 13: Increases in average earnings, 2004 and 2005 (%)

l ) a ia s lic k ia d d a ia g ta s y ia 5 e 4 tri r ru b ar n ny ce n n ur d a n ain UK EU 1 n 0 p u a a la Italy a o al n rw land p 0 us m ree u M la o o S eden le A Cy n inl France Ire Latvi P ma w o EU (2 BelgiumBulga e Eston F G ith N o S Norway Rep D Germ Hungary L ther PortugaR SlovakiaSlovenia d uro-zos e Wh n E te ch Luxemb N All countries a e 5 Cz 1 EU ember Sta M

New

2004 2005

Notes on averages: ‘all countries’ is for 28 countries in 2004 and 24 countries in 2005; ‘whole EU’ is for 25 countries in 2004 and 21 countries in 2005; ‘EU 15 and Norway’ is for 16 countries in 2004 and 12 countries in 2005; ‘EU 15’ is for 15 countries in 2005 and 11 countries in 2004; ‘euro-zone’ is for 12 countries in 2004 and nine countries in 2005; ‘new Member States’ is for 10 countries

The figures in figure 13 should be read in conjunction with the notes in Appendix 10.

Source: EIRO.

Moving from increases in earnings to their actual level, data is available from most countries for average gross earnings on an hourly, weekly or monthly basis, usually based on surveys by official statistical services - see table 14 below. There is no data for Cyprus, while for some countries the most recent figures are for 2003 or even 2002.

Comparing earnings in different countries is not a simple matter. National differences in price levels mean that the earnings’ actual value is hard to judge, while conversion into a single currency (in this case the euro for the countries outside the euro-zone) brings exchange rates into the equation. The data used here is also based on national sources, with no guarantee of harmonised definitions. However, bearing these points in mind, table 14 illustrates the great variations in earnings that exist within Europe (as well as the gender gap for pay highlighted above). Taking hourly rates, figures are available for 17 countries and the highest level (that in Denmark) is around 18 times higher than the lowest (that in Romania). Average hourly earnings in 2004/05 stood at around the EUR 20 mark in Denmark and Germany, and EUR 18-EUR 19 in the Netherlands and Luxembourg, while most of the other EU 15 countries (Austria, Finland, Ireland, Italy, Sweden and the UK) had levels of around EUR 12-EUR 16. France lagged somewhat behind at under EUR 10, but this was far ahead of the new Member State with the highest earnings - Malta, at around EUR 6 per hour. Malta, in turn, was some way ahead of the Czech Republic, at nearly EUR 4, while Estonia, Lithuania and Slovakia were all around EUR 2-EUR 3. Outside the EU, Romania was even further behind, at little more than EUR 1.

The most common way of expressing average earnings is in monthly terms, with such data available for 21 countries. Two Nordic countries - Denmark and Norway - had average monthly earnings of EUR 3,000-EUR 4,000 in 2004-05, followed by six other northern European countries at EUR 2,000-EUR 2,800 (Belgium, Finland, Germany, the Netherlands, Sweden and the UK). There was then a substantial gap with France and Greece on EUR 1,300-EUR 1,500. The highest-ranked new Member States were Slovenia and Malta at around EUR 1,000-EUR 1,100, some way ahead of the lowest-ranked old Member States - Portugal at a little over EUR 900. Monthly earnings were around EUR 700 in the Czech Republic and Hungary and around EUR 600 in Poland. The figures for Estonia, Slovakia and Lithuania were around EUR 400-EUR 500, with Latvia the lowest-placed EU Member State at some EUR 300. This was around double the figure for Bulgaria. The differential between the countries with the highest and lowest monthly earnings -Denmark and Bulgaria - is even greater than for hourly earnings, at a factor of around 25.

An overview of the differences in average gross earnings in the countries participating in the study, given as monthly and hourly rates and distinguishing between men and women where data is available

Table 14: Average gross earnings, latest available figures (2005 unless otherwise stated), in national currency Country Frequency All Women Men Austria Hourly (2002) EUR 12.23 EUR 9.96 EUR 13.53 Monthly Belgium EUR 2,589.00 EUR 2,239.00 EUR 2,704.00 (2003) BGN 315.00 (EUR BGN 291.00 (EUR BGN 340.00 (EUR Bulgaria Monthly 161.06) 148.79) 173.84) Hourly CZK 114.80 (EUR 3.85) CZK 95.18 (EUR 3.20) CZK 127.05 (EUR 4.27) Czech CZK 21,179 (EUR Republic Monthly no data no data 711.13) DKK 157.51 (EUR DKK 146.80 (EUR DKK 168.00 (EUR Hourly (2004) 21.17) 19.73) 22.58) Denmark Monthly DKK 29,668.00 (EUR DKK 27,263.00 (EUR DKK 32,110.00 (EUR (2003) 3,992.63) 3,668.97) 4,321.26) Hourly (2004) no data EEK 36.86 (EUR 2.36) EEK 48.19 (EUR 3.08) Estonia Monthly EEK 7,287 (EUR no data no data (2004) 465.72)

Hourly EUR 13.88 EUR 12.35 EUR 15.44 (2003) Weekly Finland EUR 549.90 EUR 484.90 EUR 603.20 (2003) Monthly EUR 2,372.00 EUR 2,107.00 EUR 2,621.00 (2003) Hourly EUR 9.16 no data no data France Weekly EUR 340.1 no data no data Monthly EUR 1,473.80 no data no data Hourly EUR 19.59 no data no data Germany Monthly EUR 2,205.00 no data no data Monthly Greece EUR 1,315.00 no data no data (2004) HUF 166,523.00 (EUR Hungary Monthly no data no data 671.33) Hourly EUR 14.42 EUR 11.61 EUR 15.40 Ireland Weekly EUR 579.32 EUR 429.78 EUR 636.00 Hourly EUR 13.99 EUR 14.72 EUR 12.29 (2002) Italy Annual EUR 23,664.00 no data no data (2004) Monthly LVL 211.00 (EUR LVL 179.00 (EUR LVL 212.00 (EUR Latvia (2004) 303.07) 257.11) 304.51) Hourly LTL 8.25 (EUR 2.39) LTL 7.55 (EUR 2.19) LTL 8.96 (EUR 2.59) Lithuania LTL 1,379.10 (EUR LTL 1,242.10 (EUR LTL 1,520.10 (EUR Monthly 399.41) 359.74) 440.25) Hourly Luxembourg EUR 19.54 EUR 16.60 EUR 20.76 (2004) Hourly MTL 2.60 (EUR 6.05) MTL 2.60 (EUR 6.05) MTL 2.60 (EUR 6.05) MTL 99.30 (EUR MTL 88.60 (EUR MTL 104.80 (EUR Weekly Malta 230.98) 206.09) 243.78) MTL 430.20 (EUR MTL 384.10 (EUR MTL 454.30 (EUR Monthly 1,007.00) 893.46) 1,056.76) Hourly EUR 18.18 EUR 15.81 EUR 19.59 (2004) Netherlands Monthly EUR 2,030.00 EUR 1,472.00 EUR 2,483.00 (2004) Monthly NOK 28,291.00 (EUR NOK 25,596.00 (EUR NOK 30,292.00 (EUR Norway (2004) 3,380.17) 3,058.17) 3,619.25) PLN 2,347.24 (EUR Poland Monthly no data no data 583.46) Monthly Portugal EUR 921.60 EUR 768.61 EUR 1,029.51 (2004) Hourly Romania RON 4.80 (EUR 1.18) RON 4.36 (EUR 1.08) RON 5.20 (EUR 1.28) (2004) Hourly SKK 115.04 (EUR 2.87) SKK 99.02 (EUR 2.47) SKK 129.71 (EUR 3.24) (2004) Slovakia Monthly SKK 17,042.00 (EUR SKK 14,256.00 (EUR SKK 19,700.00 (EUR (2004) 425.82) 356.20) 492.23) SIT 277, 440 (EUR Slovenia Monthly no data no data 1,158.07)

Annual Spain nd EUR 12,464.00 EUR 17,964.00 (2004) Hourly SEK 117.00 (EUR SEK 107.00 (EUR SEK 120.00 (EUR (2004) 12.82) 11.73) 13.15) Sweden Monthly SEK 23,700.00 (EUR SEK 21,500.00 (EUR SEK 25,800.00 (EUR (2004) 2,597.46) 2,356.34) 2,827.61) Hourly GBP10.69 (EUR 15.63) GBP 9.84 (EUR 14.39) GBP 11.31 (EUR 16.54) GBP 431.00 (EUR GBP 372.00 (EUR GBP 471.00 (EUR Weekly UK 630.30) 544.02) 688.80) GBP 1,908.00 (EUR GBP 1,617.00 (EUR GBP 2,092.00 (EUR Monthly 2,790.29) 2,364.73) 3,059.37)

Conversions into EUR, where necessary (using average exchange rates for 2004 and 2005 from European Central Bank).

The figures in table 14 should be read in conjunction with the notes in Appendix 11.

Source: EIRO.

Labour costs

Finally, this report takes a brief look at labour costs. For employers, labour costs - the total expenditure borne by them in order to employ workers - are at least as important an issue as pay alone. As well as compensation for employees (including wages and salaries), labour costs (as defined by Eurostat) include employers’ social security contributions, vocational training costs and taxes relating to employment.

National statistics that can provide an absolute cash value for the average hourly labour costs across the entire economy, and can track the annual increases in these costs, are not available for all the countries considered.Additionally, the figures that do exist are often not up-to-date. There are no relevant statistics available to present in Bulgaria, Cyprus, Hungary, Ireland, Norway and Portugal, hourly cash figures do not exist for Greece, Slovenia, Sweden and the UK, and the most recent data for France refers to 2000. Table 15 below presents the 2004-05 (or in some cases 2003) hourly figures and annual increases from the countries for which some relevant information is available. The overall picture resembles that for earnings (see previous section) - with a similar wide range of levels and a broadly similar ranking of countries.

An overview of the differing labour costs in participating countries expressed in euro per hour and including the increase on the previous year as a percentage

Table 15: Average hourly labour costs, 2004 and 2005, in national currency (increase on previous year) Country 2004 2005 Austria EUR 20.84 (1.5%) no data Belgium EUR 26.02 (2.4%) EUR 26.60 (2.2%) Czech Republic CZK 182.25 (EUR 5.71) (7.2%) no data Denmark DKK 228.24 (EUR 30.68) (3.1%) no data Estonia EEK 64.80 (EUR 4.14) (6.9%) no data Finland EUR 26.80 (4.3%) no data Germany EUR 24.13 (0.1%) EUR 24.33 (0.8%) Italy EUR 32.62 (2.9%) no data (2.8%) Latvia LVL 1.82 (EUR 2.74) (10.1%) LVL 2.08 (EUR 2.99) (13.6%) Lithuania (2003) LTL 10.69 (EUR 3.10) (4.2%) no data Luxembourg EUR 22.40 (2.9%) EUR 22.50 (4.1%)

Malta MTL 3.16 (EUR 7.38) (1.6%) MTL 3.21 (EUR 7.47) (1.6%) Netherlands EUR 27.44 (3.4%) no data Poland PLN 22.22 (EUR 4.91) (no data) no data Romania RON 6.50 (EUR 1.60) (21.0%) no data Slovakia SKK 167.74 (EUR 4.19) (5.5%) no data Spain EUR 14.92 (3.8%) EUR 15.89 (3.3%) Sweden no data (3.2%) no data (2.3%) UK no data (6.1%) no data (4.2%)

Conversions into EUR, where necessary (using average exchange rates for 2004 and 2005 from European Central Bank).

The figures in table 15 should be read in conjunction with the notes in Appendix 12

Source: EIRO.

Given the gaps in the national data, this report concludes with an example of a more genuinely comparative study of labour costs. The Institute of the German Economy (Institut der deutschen Wirtschaft Köln, IW) produces an annual study of hourly labour costs in manufacturing industry in many EU and other major economies. Its figures, based on national data, include: direct labour costs - pay, overtime premium, shift premium and any other regularly paid premium; and indirect labour costs - any other elements which make up annual earnings (e.g. pay for days not worked, special payments and any other cash premium), employers’ social insurance contributions, sick pay, training costs and any other social costs. The 2004 figures are set out in figure 16 below.

A summary of hourly labour costs in participating countries compiled by the Institute of the German Economy (IW) by collating information on direct and indirect labour costs.

Figure 16: Hourly labour costs in manufacturing industry, IW figures, 2004 (in EUR)

y e e y d s d d y ria rk nd c c n ly n ia in en K ada n e ar a nd a k a d U SA n ma la g la It a rway l a e rlan U lgium ra re re Japan rl o v Sp Aust e n erman Fin F I e Po ortugal w ze erman B Ca e G Hun h N P Slo S it D G t G n e r N Sw rn te Luxembourg e s st Czech Republic e Ea W

Source: IW (Industrielle Arbeitskosten im internationalen Vergleich, 2005).

Appendices

Appendix 1

Back to figure 1

The data in figure 1 should be read in conjunction with the following notes:

• Austria: figures, from Statistik Austria (2004) and Union of Salaried Employees (Gewerkschaft der Privatangestellten,GPA) (2005), refer to most collective agreements concluded in the autumn of the previous year. • Belgium: figures cover blue-collar workers only (equivalent figures for white-collar workers were 1.9% in 2004 and 2.5% in 2005); figures represent total of collectively agreed pay increases - 1.1% in 2004 and 0.6% in 2005 for blue-collar workers (0.9% in 2004 and 0.1% in 2005 for white-collar workers) - plus automatic pay indexation and effects of reduction of working time; figures, from Federal Public Service for Employment, Labour and Social Dialogue (SPF Emploi, Travail et Concertation sociale/FOD Werkgelegenheid, Arbeid en Sociaal Overleg), are for years to September. • Bulgaria: no figures available for average collectively agreed pay increase (bargaining coverage is patchy); the statistics provided, from the National Statistics Institute (NSI), are for the average increase in monthly pay; 2005 figure is for the first nine months (compared with same period in 2004). • Cyprus: figures from Pancyprian Federation of Labour (PEO). • Czech Republic: figures, from Information System on Working Conditions (ISWC), refer to nominal increases in enterprise-level collective agreements (the more prevalent bargaining level); the Czech-Moravian Confederation of Trade Unions (Ceskomoravská konfederace odborových svazu, CMKOS) estimates the average nominal increase in higher-level collective agreements signed by its affiliates at 4.0% in 2004 and 4.0% in 2005. • Denmark: no general figures available, and figures used relate to the key industry sector agreement, which operates the minimum-wage system, whereby sectoral agreements set only minimum rates, with subsequent local bargaining producing further increases; the figures represent the minimum increases in hourly wages from March each year. • Estonia: no figures available for average collectively agreed pay increases (data collection is still being developed and bargaining coverage is low); the statistics provided are the increases recorded in a wages survey by the Statistical Office of Estonia (Statistikaamet, ESA); 2005 figure is the increase in the fourth quarter, compared with the fourth quarter of 2004. • Finland: figures refers to the average annual labour cost impact of central incomes policy agreements, which provided: in 2004 for a general rise of EUR 0.16 per hour or EUR 26.72 per month from March, with a minimum increase of 1.7%, plus an additional 0.5% for sectoral distribution; and in 2005 for a general rise of EUR 0.18 per hour or EUR 30.06 per month from March, with a minimum increase of 1.9%, plus an additional 0.6% for sectoral distribution. • France: no figures available for average collectively agreed pay increases; figures given, from National Institute of Statistics and Economic Studies (Institut national de la statistique et des études économiques, INSEE), are for increase in average earnings; 2005 figure for year to end of third quarter. • Germany: figures, from the Institute for Economics and Social Science (Wirtschafts- und Sozialwissenschaftliches Institut, WSI) collective agreement archive, represent the annual average increase in collectively agreed pay per employee. • Greece: figures refer to increases in minimum rates as set out in 2004-5 National General Collective Agreement; 2004 figure includes 4% rise from 1 January and 2% from 1 September; 2005 figure includes 2.2% rise from 1 January and 3.3% from 1 September. • Hungary: 2004 figure from Ministry of Employment and Labour (Foglalkoztatáspolitikai és Munkaügyi Minisztérium, FMM); no final figure available for 2005 - figure given is the centrally recommended increase for the competitive sphere, i.e. private and state-owned companies. • Ireland: the 2004 figure refers only to the private sector and represents the second half of the second 2% increase under the first part of the Sustaining Progress (SP) national wage agreement (2003-4), plus the final 2% increase under the first part, plus the first 1.5% awarded under the second part of SP deal (which also awarded low-paid workers an additional 0.5%); the 2005 figure refers only to the private sector and represents 1.5% under the second phase of the second part of SP, plus 2.5% under the third and final phase of the second part of SP; different pay arrangements apply under national agreements in the public sector, with average increases totalling 11.5% in 2004 and 5.25% in 2005 (plus 0.5% for low-paid workers).

• Italy: figures, from National Institute of Statistics (Istituto Nazionale di Statistica, Istat), based on the national sectoral collective agreements (including basic pay, shift allowances, monthly bonuses and other bonuses regularly paid during the course of the year); 2005 figure represents the January-November increase compared with same period in 2004. • Latvia: no figures available for average collectively agreed pay increases; the statistics provided, from the Central Statistical Bureau (Centrala statistikas parvalde, CSP), are for increases in the average gross monthly wages and salaries of employees; 2005 figure is for year to third quarter. • Lithuania: no figures available for average collectively agreed pay increases; the statistics provided, from Lithuanian Statistics (Lietuvos statistikos departamentas), are for increases in average gross monthly earnings; 2005 figure is for year to third quarter. • Luxembourg: no official statistics available; figures represent average of estimated range of pay increases, plus 2.5% automatic pay indexation in each year (from October). • Malta: figures, from the Economic Survey by the government’s Economic Policy Division, refer to the 12 months to September in each year. • Netherlands: figures from Statistics Netherlands (Centraal Bureau voor de Statistiek, CBS). • Norway: there are no reliable figures on collectively agreed basic pay increases for all employees; the figures given, from the Technical Calculation Committee for Income Settlements (Teknisk Beregningsutvalg, TBU), represent the total annual pay increase (including wage drift - the above average increase in salaries in certain sectors - and carryover effects from previous years); 2005 figure expressed by TBU as 3.25%. • Poland: no figures available for average collectively agreed pay increase; figures provided, from the Central Statistical Office of Poland (Glówny Urzad Statystyczny, GUS), refer to increases in average earnings; 2005 figure is for year to third quarter. • Portugal: figures, from Ministry of Social Security and Labour’s Directorate General for Employment and Labour Relations (Direcção Geral do Emprego e das Relações de Trabalho, DGERT), refer to collective agreements published in each year; 2005 figure is for year to November. • Romania: 2004 figure refers to national minimum wage increase imposed by government (after bargaining over a single national collective agreement failed); 2005 figure refers to the increase set out in the tripartite national collective agreement which provides a minimum basic framework for employment conditions. • Slovakia: figures from Information System on Working Conditions, Trexima Bratislava. • Slovenia: figures, from Official Journal of the Republic of Slovenia (Uradni list Republike Slovenije), refer to private sector only; equivalent figures for public sector were 1.2% in 2004 and 2.2% in 2005. • Spain: figures from Ministry of Labour and Social Affairs (Ministerio de Trabajo y Asuntos Sociales, MTAS) labour statistics publications; 2005 figure for year to November. • Sweden: figures represent an estimate based on the three-year agreements concluded in the 2004 bargaining round, including 0.5% as estimated effect of working time reduction in each year. • UK: figures, from Labour Research Department (LRD) Workplace Report, refer to increase in lowest basic rates; 2004 figure is for the 12 months up to and including December 2004; 2005 is for the 12 months up to and including November 2005.

Appendix 2

Back to figure 3

The data in figure 3 should be read in conjunction with the following notes:

• Austria: figures, from GPA, relate to sectoral collective agreement; increases applied for 12 months from November 2003 and November 2004 respectively. • Belgium: no percentage figure can be given for metalworking industry (joint committee 111.01 and 111.02), as relevant sectoral agreement provided for automatic pay indexation over the two years, plus a cash increase of EUR 0.115 per hour from October 2004. • Bulgaria: figures relate to sectoral collective agreement and refer to increase in basic monthly pay for those on normal working time (minimum pay for low-qualified workers was increased by 15%).

• Cyprus: figures, from Cyprus Metalworkers Mechanics and Electricians Trade Union (SEMMHK-PEO), are approximate, representing monthly increases of CYP 5.60 from January 2004 and CYP 5.85 from January 2005. • Czech Republic: figures, from ISWC, refer to nominal increases in enterprise-level collective agreements (the more prevalent bargaining level); CMKOS estimates the average nominal increase in higher-level collective agreements signed by its sectoral affiliates at 2.0%-3.0% in 2004 and 2.5 % in 2005. • Denmark: figures relate to the industry sector agreement (for 2004-7), which operates the ‘minimum-wage’ system, whereby sectoral agreements set only minimum rates, with subsequent local bargaining producing further increases; the figures represent the minimum hourly increases from March each year. • Estonia: figures, from ESA, are for increase in average wages in manufacturing as a whole - 2005 figure is for fourth quarter, compared with same quarter in previous year; no data available on collectively agreed increases or metalworking alone. • Finland: figures relate to sectoral collective agreement; 2004 figure is an estimate, based on the minimum increase (from 1 March) of 1.8% (or a cash rise of EUR 0.17 per hour or EUR 29.68 per month) plus a company-specific increase (EUR 0.04 per hour or EUR 6.98 per month); 2005 figure is an estimate, based on the minimum increase (from 1 March) of 2.0% (or a cash rise of EUR 0.24 per hour or EUR 40.54 per month) plus a company-specific increase (EUR 0.03 per hour or EUR 5.24 per month). • France: figure is the mid-range of department-level agreements providing for increases ranging from zero to 6.7% (e.g. in Côte-d’Armor). • Germany: figures, from the WSI collective agreement archive, refer to the Baden-Württemberg ‘pilot agreement’ and refer only to increases in basic pay, excluding flat-rate payments and special bonuses; increases applied from March 2004 and March 2005. • Greece: figures, based on collective agreements and arbitration decisions, refer to blue-collar workers and technicians; 2004 increase includes rises of 4% from January and 2.5% from September; 2005 increase includes rises of 2.7% from January and 3.8% from September. • Hungary: 2004 figure relates to relevant collective agreements; no specific final figure available for 2005, figure given is the centrally recommended increase for the competitive sphere. • Ireland: figures represent pay increases under national agreements - see note to figure 1 above. • Italy: data from Istat; 2005 figure is for the year to November. • Luxembourg: figures are for blue-collar workers and represent mid-point of increases of 0.8%- 1.39% in 2004 and 0.8%-1.64%in 2005 (rises for white-collar workers were 0.5%-1.39% and 0.5%-1.64%), plus automatic indexation-related increase of 2.5% in each year. • Netherlands: figures, from CBS, relate to monthly pay including ‘extras’. • Norway: figures, from TBU, include more than collectively agreed pay increases (eg wage drift and carryover effects); 2004 figure is for blue-collar workers in metalworking and 2005 figure (expressed by TBU as 3 and a quarter %) for all industrial blue-collar workers. • Portugal: figures, from DGERT, relate to sectoral collective agreements; no agreement signed in 2004 but a 5.5% pay increase agreed (for 12 months) from April 2005 - according to the SINDEL-UGT trade union, this should be seen as 3% for 2004 and 2.5% for 2005. • Romania: figures are EIRO calculations, based on data from National Statistics (Institutul National de Statistica, INS), and refer to effective nominal growth of monthly average gross wage in November each year compared with the same month in the previous year; no sectoral collective agreement signed in 2004 or 2005. • Slovakia: figures, from Information System on Working Conditions, Trexima Bratislava, relate to sectoral collective agreements signed for each year by the Metalworkers’ Union (OZ KOVO). • Slovenia: figures refer to minimum increases (based on central agreement) in the average gross wage in the industry laid down in sectoral collective agreement, which provided for flat- rate monthly pay increases of SIT 4,000 in May 2004, SIT 4,000 in August 2004, SIT 4,000 in November 2004 and SIT 5,100 in August 2005. • Spain: figures from MTAS; 2005 figure for period up until November. • Sweden: figures refer to 2004-6 national metalworking agreements, which provided for a total minimum pay increase of 7.3% over three years; the figures include 0.5 percentage points per year representing the effect of working time reduction. • UK: figures, from LRD Workplace Report October 2004 and 2005, represent an average of agreements and refer to ‘midpoint increases’ in lowest basic rates in ‘manufacturing - engineering and metal products’.

Appendix 3

Back to figure 4

The data in figure 4 should be read in conjunction with the following notes:

• Austria: figures, from Union of Chemical Workers (Gewerkschaft der Chemiearbeiter,GdC) and GPA, relate to sectoral collective agreements; increases applied from May each year. • Belgium: no percentage figure can be given for chemicals industry (joint committee 116), as relevant sectoral agreement provided for automatic pay indexation over the two years, plus cash increases of EUR 0.12 per hour from January 2004, EUR 0.05 from July 2004 and EUR 0.09 from April 2005. • Bulgaria: sectoral agreement for 2004-5, figure given is the average of increases awarded by enterprise-level collective agreements at Solvay, Soffarma and Balkanfarma, as reported by sectoral trade union. • Cyprus: approximate figure from January 2004, provided by Cyprus Industrial, Commercial, Press-Printing and General Services Workers’ Trade Union (SEVETTYK-PEO). • Czech Republic: figures are the mid-point of the range of increases under relevant enterprise- level collective agreements (the more prevalent bargaining level), according to ISWC and sectoral union data; higher-level collective agreements, as estimated by CMKOS, provided for increases of 0.1%-1.1% in 2004 and 2.5% in 2005. • Denmark: figures relate to the industry sector agreement (for 2004-7), which operates the ‘minimum-wage’ system, whereby sectoral agreements set only minimum rates, with subsequent local bargaining producing further increases; the figures represent the minimum hourly increases from March each year. • Estonia: figures, from ESA, are for increase in average wages in manufacturing as a whole - 2005 figure is for fourth quarter, compared with same quarter in previous year; no data available on collectively agreed increases or chemicals alone. • Finland: percentages given are minimum increases, with relevant sectoral agreement providing for cash increases of EUR 0.21 per hour or EUR 34 per month in 2004 and EUR 0.24 per hour or EUR 40.54 per month in 2005 (plus increased shift pay premium); increases applied from March each year. • France: figures from INSEE; 2005 data are for year to third quarter. • Germany: figures, from the WSI collective agreement archive, are for western Germany and refer only to increases in basic pay, excluding flat-rate payments and special bonuses; increases awarded from June, July or August, depending on region; 2005 agreement had 19- month term. • Greece: figures, based on collective agreements and arbitration decisions, refer to blue-collar workers and technicians; 2004 increase includes rises of 4.5% from January and 2% from July; 2005 increase includes rises of 3% from January and 3% from July. • Hungary: 2004 figure relates to relevant collective agreements; no specific final figure available for 2005, figure given is the centrally recommended increase for the competitive sphere. • Ireland: figures represent pay increases under national agreement - see note to figure 1 in Appendix 1. • Italy: data from Istat; 2005 figure is for the year to November. • Luxembourg: figures are estimates and include automatic indexation-related increase of 2.5% in each year (paid in October). • Malta: figures, from government Economic Policy Division, represent increases between September 2003 and September 2004 and between September 2004 and September 2005 respectively; figures based on a sample of company-level agreements and refer to average weekly wages. • Netherlands: figures, from CBS, relate to monthly pay including ‘extras’. • Norway: figures, from TBU, include more than collectively agreed pay increases (e.g. wage drift and carryover effects); 2004 figure is for blue-collar workers in chemicals and 2005 figure (expressed by TBU as 3.25%) for all industrial blue-collar workers. • Portugal: no sectoral collective agreement reached in either year, according to Portuguese Association of Employers in the Chemical Industry (Associação Portuguesa das Empresas Químicas, APEQ). • Romania: figures relate to annual average increases under sectoral agreements for chemicals and petrochemicals signed in May 2004 and April 2005.

• Slovakia: figures, from Information System on Working Conditions, Trexima Bratislava, relate to sectoral collective agreements signed for each year by the Chemical Workers’ Union (OZ CHÉMIA) • Slovenia: figures refer to minimum increases (based on central agreement) in the average gross wage in the industry laid down in sectoral collective agreement, which provided for flat- rate monthly pay increases of SIT 7,800-SIT 13,220 in August 2004 and SIT 7,000-SIT 13,220 in August 2005. • Spain: figures from MTAS; 2005 figure for period up until November. • Sweden: figures refer to 2004-6 national chemicals agreements, which provided for a total minimum pay increase of 7.3% over three years; the figures include 0.5 percentage points per year representing the effect of working-time reduction. • UK: figures, from LRD Workplace Report October 2004 and 2005, represent an average of agreements and refer to ‘midpoint increases’ in lowest basic rates in ‘manufacturing - chemical, minerals and metals’.

Appendix 4

Back to figure 5.

The data in figure 5 should be read in conjunction with the following notes:

• Austria: figures, from GPA, relate to sectoral collective agreement; increases applied from February each year. • Belgium: no percentage figure can be given for banking (joint committee 310), as relevant sectoral agreement provided for automatic pay indexation over the two years, plus a bonus of EUR 200 in 2004. • Cyprus: figures from Cyprus Union of Bank Employees (ETYK); 2004 increase applied from January-December, 2005 increase from July-December. • Denmark: figures relate to sectoral collective agreement (which operates a standard system, whereby there whereby the sectoral agreement sets actual rates and there are no additional local pay negotiations); increases applied from July each year. • Estonia: figure, from ESA, is for annual increase in average wagesfor financial intermediaries; no data on collectively agreed increases. • Finland: percentages given are minimum increases, with relevant sectoral agreement providing for cash increases of EUR 0.16 per hour or EUR 26.72 per month in 2004 and EUR 0.18 per hour or EUR 30.06 per month in 2005; increases applied from March each year. • France: figures from INSEE; 2005 data are for year to third quarter. • Germany: figures, from WSI collective agreement archive, refer only to increases in basic pay and exclude flat-rate payments and special bonuses; increases applied from September each year. • Greece: figures based on collective agreements and arbitration decisions; 2004 increase includes rises of 4% from January and 2% from September; 2005 increase includes rises of 3% from January and 2.9% from September. • Hungary: 2004 figure relates to relevant collective agreements; no specific final figure available for 2005, figure given is the centrally recommended increase for the competitive sphere. • Ireland: figures represent pay increases under national agreements - see note to figure 1 in Appendix 1. • Italy: data from Istat; 2005 figure is for the year to November. • Luxembourg: 2004 figure made up of a 1.1% increase in total pay, plus an automatic indexation-related increase of 2.5% (paid in October); 2004 figure made up of a 1.1% increase in total pay, plus a 0.4% general increase and an automatic indexation-related increase of 2.5% (paid in October). • Malta: figures, from government Economic Policy Division, refer to increases in ‘banking and other financial intermediaries’ between September 2003 and September 2004 and between September 2004 and September 2005 respectively; figures based on a sample of company- level agreements and refer to average weekly wages. • Netherlands: figures, from CBS, relate to monthly pay including ‘extras’. • Norway: figures, from TBU, include more than collectively agreed pay increases (e.g. wage drift and carryover effects).

• Portugal: figures from Southern and Islands Bank Workers’ Union (Sindicato dos Bancários Sul-Ilhas, SBSI) and Central Portugal Bank Workers’ Union (Sindicato dos Bancários do Centro, SBC); increases applied from January each year. • Romania: no sectoral agreement in banking; figures are EIRO calculation based on INS data for ‘financial intermediaries’, and refer to effective nominal growth of monthly average gross wages in November each year compared with the same month in the previous year. • Slovakia: figures, from Information System on Working Conditions, Trexima Bratislava, relate to sectoral collective agreements signed for each year by the Banking and Insurance Union (OZ PPap). • Slovenia: figures refer to minimum increases (based on central agreement) in the average gross wage for the industry laid down in sectoral collective agreement, which provided for flat- rate monthly pay increases of SIT 10,420 in August 2004 and SIT 9,768 in August 2005. • Spain: figures, from MTAS, refer to banking and insurance; 2005 figure for period up until November. • Sweden: figures refer to bank and finance sector collective agreement for white-collar workers. • UK: figures, from LRD Workplace Report October 2004 and 2005, represent an average of agreements and refer to ‘midpoint increases’ in lowest basic rates in ‘finance and business services’.

Appendix 5

Back to figure 6

The data in figure 6 should be read in conjunction with the following notes:

• Austria: figures, from GPA, relate to sectoral collective agreement; increases applied from January each year. • Belgium: no percentage figure can be given for retail (joint committee 312), as relevant sectoral agreement provided for automatic pay indexation over the two years, plus cash increases of EUR 0.1852 per hour from January 2004 and EUR 0.0989 from September 2005. • Bulgaria: figures from sectoral trade union; annual figures represent half of a 9% increase awarded under a 2004-5 collective agreement. • Cyprus: figures are the average of the range of increases awarded under the collective agreements for the largest enterprises in the sector, as reported by SEVETTYK-PEO; recent recruits received additional increases. • Czech Republic: figures, from ISWC, relate to enterprise-level collective agreements. • Denmark: figures, from Danish Commerce and Service (Dansk Handel & Service, DHS), represent the minimum monthly increases from March each year under sectoral collective agreement. • Estonia: no figures available for average collectively agreed pay increases; figure provided is the annual increase recorded in a wages survey by ESA and applies to wholesale and retail trade in general. • Finland: percentages given are minimum increases, with relevant sectoral agreement providing for cash increases of EUR 0.21 per hour or EUR 34 per month in 2004 and EUR 0.24 per hour or EUR 39 per month in 2005 (plus an additional increase of EUR 0.2 per hour or EUR 3 per month for salespeople); increases applied from March each year. • France: figures from INSEE; 2005 data are for year to third quarter. • Germany: figures, from WSI collective agreement archive, are for annual increases in collectively agreed pay in commerce generally. • Greece: figures, based on collective agreements and arbitration decisions, refer to commerce; 2004 increase includes rises of 4% from January and 2.6% from September; 2005 increase includes rises of 2.5% from January and 3.5% from September • Hungary: 2004 figure relates to relevant collective agreements; no specific final figure available for 2005, figure given is the centrally recommended increase for the competitive sphere. • Ireland: figures represent pay increases under national agreement - see note to figure 1 in Appendix 1. • Italy: data from Istat; 2005 figure is for the year to November. • Luxembourg: figures are estimates and include automatic indexation-related increase of 2.5% in October each year.

• Malta: figures, from government Economic Policy Division, refer to increases in ‘wholesale and retail trade’ between September 2003 and September 2004 and between September 2004 and September 2005 respectively; figures based on a sample of company-level agreements and refer to average weekly wages. • Netherlands: figures, from CBS, relate to monthly pay including ‘extras’. • Norway: figures, from TBU, include more than collectively agreed pay increases (e.g. wage drift and carryover effects). • Portugal: figures, from DGERT, refer to collective agreements published in each year. • Romania: figures relate to annual average increases under the 2003-5 collective agreement for the trade sector, and take into account the effects of a provision in the agreement that minimum pay in this sector must be 5% higher than the national minimum wage. • Slovakia: figures relate to collective agreements signed each year for the cooperative retail sector and represent maximum increases. • Slovenia: figures refer to minimum increases (based on central agreement) in the average gross wage in the industry laid down in sectoral collective agreement, which provided for flat- rate monthly pay increases of SIT 7,500 in August 2004 and SIT 5,100 in August 2005. • Spain: figures, from MTAS, refer to retail and domestic repairs; 2005 figure for period up until November. • Sweden: figures refer to national sectoral agreements for blue-collar and white-collar workers. • UK: figures, from LRD Workplace Report October 2004 and 2005, represent an average of agreements and refer to ‘midpoint increases’ in lowest basic rates in ‘retail, wholesale, hotel and catering’.

Appendix 6

Back to figure 7

The data in figure 7 should be read in conjunction with the following notes:

• Austria: pay increases fixed by law at regional (Länder) level; data from Union of Employees of the Local State (Gewerkschaft der Gemeindebediensteten, GdG). • Bulgaria: increases agreed in the National Council for Tripartite Cooperation (NSTP) and imposed by cabinet decree. • Cyprus: data from Semi-government, Municipal and Local Authority Workers’ and Employees’ Trade Union Cyprus (SIDIKEK-PEO). • Czech Republic: figures, from ISWC, refer to nominal increases in enterprise-level collective agreements. • Denmark: 2004 figure, from Ministry of Finance, is the sum of increases of 0.9% awarded in April, 1% in August and 0.42% in October; 2005 figure, from Association of Local Government Employees’ Organisations (Kommunale Tjenestemænd og Overenskomstansatte, KTO), represents increase applied in April. • Estonia: figure, from ESA, is for annual increase in average wages in public administration and defence; no data on collectively agreed increases. • Finland: 2004 figure is a minimum increase, with relevant agreement providing for cash increases of EUR 26.73 per month; 2005 figure represents the increase for those earning EUR 1582.11 or less a month - higher earners received 0.6 % plus a cash increase of EUR 30.06 per month; increases applied from March each year. • France: figure from INSEE. • Germany: figures, from WSI collective agreement archive, refer only to increases in basic pay and exclude flat-rate payments and special bonuses; 2004 figure represents sum of increases of 1% from January and 1% from May; no percentage increase awarded in 2005, only a lump- sum flat-rate payment of EUR 300. • Greece: figures are estimates for public sector employees working under a private-law contract, whose conditions are set by collective agreement; different increases applied to local government civil servants, whose conditions are set by law - e.g. some categories received a 3.5% increase in basic salary in 2005. • Hungary: figures refer to centrally agreed increases for public employees. • Ireland: figures refer to public sector increases under SP national wage agreement; in 2005, low-paid workers received an additional 0.5%. • Italy: data from Istat; 2005 figure is for the year to November.

• Luxembourg: the figures for each year include an automatic indexation-related increase of 2.5%, paid in October. • Netherlands: 2004 figure from CBS; 2005 figure is estimate, based on existence of wage freeze. • Norway: figures, from TBU, include more than collectively agreed pay increases (e.g. wage drift and carryover effects); 2005 figure expressed by TBU as 3.5%. • Portugal: increases are set, from January each year, by governmental orders, following consultation; 2004 increase awarded only to employees earning less than EUR 1,000 per month. • Romania: pay increases set by state budget law rather than collective bargaining; figures are EIRO calculation based on INS data for the ‘state budget-financed system’, and refer to effective nominal growth of monthly average gross wages in November each year compared with the same month in the previous year. • Slovakia: figures refer to increases set by sectoral collective agreements for public service for each year; 2004 increase applied only to regional government employees, with local government employees receiving 5% under informal agreements; 2005 figure applies to both regional and local agreements; increases applied from July each year. • Slovenia: figures refer increases set out in pay policy agreement for the public sector; increases applied from July each year. • Spain: figures, from MTAS, refer to ‘public administration, defence and social security, extra- territorial organisations’. • Sweden: figure is average of increases awarded under agreements for main categories of local government employees; average for blue-collar workers was 2.9% in 2004 and 2.9% in 2005; average for white-collar workers was 2.2% in 2004 and 2.0% in 2005. • UK: figures, from Incomes Data Services (IDS) Pay Report August 2005, refer to the local authorities multi-employer agreement for England and Wales (which with the Greater London agreement covers nearly 1.5 million employees) - for Scotland (169,000 employees), the figure was 2.9% for both 2004 and 2005.

Appendix 7

Back to figure 8

The data in figure 8 should be read in conjunction with the following notes:

• Austria: pay increases fixed by federal law; figures from Union of Public Employees (Gewerkschaft Öffentlicher Dienst, GÖD). • Belgium: figures refer to automatic indexation only in both years. • Bulgaria: increases agreed in the National Council for Tripartite Cooperation (NSTP) and imposed by cabinet decree. • Cyprus: data from Pancyprian Union of Public Servants (PASYDY). • Czech Republic: figures, from ISWC, relate to enterprise-level collective agreements; statutory increases stood at around 4% in 2004 and 4% in 2005. • Denmark: figures from Ministry of Finance; 2004 figure is the sum of a 1.8% increase awarded in April and a 0.74% increase in October; 2005 increase applied from April. • Estonia: figure, from ESA, is for annual increase in average wages in public administration and defence; no data on collectively agreed increases. • Finland: percentages given are minimum increases, with relevant agreement providing for a cash increase of EUR 0.16 per hour or EUR 26.72 per month in 2004 and of EUR 0.18 per hour or EUR 30.03 per month in 2004; increases applied from March each year; in addition, renewal of the public sector payment system involved changes in contractual minimum wages in 2004. • France: pay increases fixed by law; 2005 figure is the sum of a 0.5% increase awarded in February and a 0.5% increase in July. • Germany: figures, from WSI collective agreement archive, refer only to increases in basic pay and exclude flat-rate payments and special bonuses; 2004 figure represents sum of increases of 1% from January and 1% from May; no percentage increase awarded in 2005, only a lump- sum flat-rate payment of EUR 300. • Greece: figures are estimates for public sector employees working under a private-law contract, whose conditions are set by collective agreement; different increases applied to central civil

servants, whose conditions are set by law - e.g. some categories received a 3.5% increase in basic salary in 2005. • Hungary: figures refer to centrally agreed increases for public employees. • Ireland: figures represents public sector pay increase under national agreement, plus ‘benchmarking’ payments, and represent mid-point of range of total increases awarded to civil servants of 11.25%-14.0% in 2004 and 5.12%-6.5% in 2005 (excluding an additional 0.5% for low-paid workers). • Italy: data from Istat; 2005 figure is for the year to November. • Luxembourg: the figures for each year include an automatic indexation-related increase of 2.5%, paid in October. • Netherlands: 2004 figure from CBS; 2005 figure is estimate, based on existence of wage freeze. • Norway: figures, from TBU, include more than collectively agreed pay increases (e.g. wage drift and carryover effects). • Poland: figures represent the annual increase in the basic amount used as the basis for civil service pay determination (multiplied by a specific co-efficient for each group of civil servants), set annually by the State Budget Act. • Portugal: increases are set, from January each year, by governmental orders, following consultation; 2004 increase awarded only to employees earning less than EUR 1,000 per month. • Romania: pay increases set by state budget law rather than collective bargaining; figures are EIRO calculation based on INS data for the ‘state budget-financed system’, and refer to effective nominal growth of monthly average gross wages in November each year compared with the same month in the previous year. • Slovakia: figures refer to increases set by sectoral collective agreements for civil service for each year; increases applied from August 2004 and July 2005. • Slovenia: figures refer increases set out in pay policy agreement for the public sector; increases applied from July each year. • Spain: figures, from MTAS, refer to ‘public administration, defence and social security, extra- territorial organisations’. • Sweden: 2004-7 collective agreements for blue- and white-collar workers in the central government sector provided for a total wage rise of at least 7.3%, with distribution to be bargained locally - in the event of disagreement, increases of 2.4%, 2.4 % and 2.5% in the three years; the agreements for professional workers in the sector provided for no quantified pay increases . • UK: as the central service has highly decentralised and fragmented arrangements for pay- setting, the figures, from IDS Pay Report August 2005, refer to the Department for Work and Pensions, which is the largest bargaining unit (covering 130,000 employees); in both years, the lowest increase recorded by IDS was for the National Assembly for Wales (4,000 employees) at 3.5% in 2004 and 2.5% in 2005; the highest was for ‘non-industrials’ at the Ministry of Defence (50,000 employees) with 5.1% in both years.

Appendix 8

Back to figure 9

The statistics in figure 9 should be read in conjunction with the following notes.

• Belgium: increases, agreed by social partners and given legal force, applied from October 2004 and August 2005. • Bulgaria: increases, agreed in NSTP and imposed by cabinet decree, applied from January each year. • Czech Republic: increases, applied by government resolution, applied from January each year. • Estonia: increases, set by government decree based on consensus among the social partners, applied from January each year. • France: increases applied by the government from July each year; increases given refer to hourly minimum wage, which applies to those workers still working a 39-hour week. For all other workers on the minimum wage, the rises are lower (as low as 2.1% from July 2004 and 1.7% from July 2005), depending on when their company changed over to the 35-hour week. • Greece: figures refer to increases in minimum rates as set out in 2004-5 National General Collective Agreement; 2004 increase made up of rises of 4% from January and 2% from

September (plus monthly cash rises of EUR 8 for those on hourly rate and EUR 8.5 for those on monthly rate); 2005 increase made up of rises of 2.2% from January and 3.3% from September. • Hungary; increases, agreed in tripartite council and imposed by government, applied from January each year. • Ireland: increases, set by tripartite national pact, applied from February 2004 and May 2005. • Latvia: 2004 increase, set by government regulation, applied from January; no increase in 2005. • Lithuania: increases applied by the government upon submission of a proposal by the Tripartite Council of the Republic of Lithuania (Lietuvos Respublikos Trišale taryba, LRTT); increase for 2004 applied from May; increase for 2005 applied from July. • Luxembourg: 2004 figure represents only an automatic indexation increase awarded in October 2005 figure includes a 2% increase awarded by law in January, plus an automatic indexation increase of 2.5% awarded in October. • Malta: increases applied by government order from January each year. • Netherlands: no increase awarded by government in 2004 or 2005. • Poland: increases set by tripartite body. • Portugal: increases applied by law in January of each year. • Romania: figures refer to annual average increases, applied in January of each year by government decree (following social partner consultation). • Slovakia: increases awarded by government regulation (based on tripartite agreement) in October of each year. • Slovenia: increases applied by government regulation (based on tripartite agreement) in August of each year. • Spain: 2004 increase is sum of rises applied by law in January (2.0%) and July (6.57%); 2005 increase awarded by law in January. • UK: figures refer to adult hourly rate; increases awarded by government decision in October of each year.

Appendix 9

Back to figure 12

The figures in figure 12 should be read in conjunction with the following notes:

• Austria: figure from Austrian Institute of Economic Research (Österreichisches Institut für Wirtschaftsforschung, WIFO). • Belgium: figure from National Statistics Institute (Institut National de Statistiques/Nationaal Instituut voor de Statistiek, INS/NIS). • Bulgaria: figure, from NSI, refers to average monthly pay. • Cyprus: approximate figure from Statistical Service of Cyprus. • Czech Republic: figure, based on data from Czech Statistical Office (Ceský statistický úrad, CSÚ) Information System on Average Earnings, refers to ‘business branches’ (equivalent figure for ‘non-business branches’ was 78.1%). • Denmark: figure from Statistics Denmark (Danmarks Statistik). • Estonia: figure based on data from ESA hourly wages and salaries survey. • Finland: figure, from Statistics Finland (Tilastokeskus), includes public sector teachers (80.0% excluding this group) and assumes working hours to be the same for male and female teachers. • France: figure from Centre d’études et de recherches sur les qualifications (Cereq). • Germany: figure, from Federal Statistical Office (Statistisches Bundesamt, Destatis), refers to blue-collar workers only - equivalent figure for white-collar workers was 70.5%. • Greece: figure, from Eurostat structure of earnings survey, refers to gross hourly earnings in industry and services. • Hungary: figure is average of various estimates. • Ireland: figure from Central Statistics Office (CSO). • Italy: figure, from Eurostat structure of earnings survey, refers to gross hourly earnings in industry and services. • Latvia: figure, from CSP, refers to average monthly gross salary.

• Lithuania: figure, from Lithuanian Statistics, is for third quarter and excludes ‘individual enterprises’. • Luxembourg: figure, from Eurostat structure of earnings survey, refers to gross hourly earnings in industry and services. • Malta: figure, is an estimate from the National Statistics Office, based on the average gross hourly earnings of paid employees aged 16-64 working 15+ hours per week. • Netherlands: figure based on CBS data for gross earnings. • Norway: figure, from Statistics Norway (Statistisk sentralbyrå, SSB), relates to average monthly earnings in third quarter of 2004, full-time equivalents. • Poland: figure from GUS employment and earnings survey. • Portugal: figure, from Eurostat structure of earnings survey, refers to gross hourly earnings in industry and services. • Romania: figure, from INS, based on survey of wage earnings and labour costs. • Slovakia: figure from Slovak Statistical Office (Štatistický úrad Slovenskej republiky, ŠÚ SR) wage structure survey (excludes self-employed and their employees and uses only a limited sample of employees in enterprises with up to 20 employees). • Slovenia: figure, from Statistical Office of the Republic of Slovenia (Statisticni urad Republike Slovenije, SURS), refers to average monthly wages. • Spain: figure from National Statistical Institute (Instituto Nacional de Estadística, INE) pay structure survey. • Sweden: figure, from Statistics Sweden (Statistiska Centralbyrån, SCB), refers to annual pay. • UK: figure from Office for National Statistics (ONS) annual survey of hours and earnings.

Appendix 10

Back to figure 13

The figures in figure 13 should be read in conjunction with the following notes:

• Austria: figure from Austrian National Bank (Österreichische Nationalbank, ÖNB). • Belgium: see note to figure 1. • Bulgaria: see note to figure 1. • Cyprus: figures from European Commission. • Czech Republic: figures, from CSÚ, are for first nine months of year. • Denmark: figure, from Statistics Denmark, is for increase in hourly pay. • Estonia: see note to figure 1. • Finland: figures from Statistics Finland; 2005 figure is for year to third quarter. • France: figures from INSEE; 2005 figure is for year to third quarter. • Germany: figures, from Federal Statistical Office, refer to annual increase in gross wages and salaries per employee. • Greece: figures, from National Statistical Service, refer to annual increase in actual earnings. • Hungary: figures from Central Statistical Office (Központi Statisztikai Hivatal, KSH); 2005 figure is for January to November. • Ireland: figures, from CSO, refer to average industrial earnings in the private sector (public sector figures were 9.5% in 2004 and 5.5% 2005); 2005 figure is for year to September. • Italy: figures, from Istat, refer to earnings only in large firms in industry and services (ie those with at least 500 employees); 2005 figure is for the year to October. • Latvia: see note to figure 1. • Lithuania: see note to figure 1. • Luxembourg: figures are estimates and include automatic pay indexation of 2.5% in each year. • Malta: figures, from government Economic Policy Division, are for increase in nominal average weekly earnings; figures for year to September. • Netherlands: figure from CBS. • Norway: see note to figure 1. • Poland: see note to figure 1. • Portugal: figure based on survey data from Ministry of Labour and Solidarity’s General Directorate for Studies, Statistics and Planning (Direcção-Geral de Estudos, Estatística e Planeamento, DGEEP).

• Romania: figures, based on INS data for effective nominal growth in monthly average wages, are for year to November each year. • Slovakia: figures from ŠÚ SR wage structure survey (excludes self-employed and their employees and uses only a limited sample of employees in enterprises with up to 20 employees). • Slovenia: figures, from Institute of Macroeconomic Analysis and Development (Urad RS za makroekonomske analize in razvoj, UMAR) based on SURS data, refer to growth rate of gross wage per employee in nominal terms, all sectors; 2005 figure is an estimate. • Spain: 2004 figure from MTAS; 2005 figure, from INE, refers to the increase in wage costs per worker in the year to the third quarter. • Sweden: figures from SCB. • UK: figures based on ONS average earnings index, year to July 2004 and July 2005.

Appendix 11

Back to table 14

The figures in table 14 should be read in conjunction with the following notes:

• Austria: figures from Statistik Austria. • Belgium: figures, from INS/NIS, refer to average primary monthly salary of full-time workers in the private sector in October 2003. • Bulgaria: figures, from NSI, are for average pay in the first nine months of 2005. • Czech Republic: data, from CSÚ Information System on Average Earnings, refer to ‘business branches’ only; hourly figures are for the last quarter of 2005, monthly figures for the first nine months of the year. • Denmark: hourly figures, based on Statistics Denmark data, represent an average of the earnings for private, local government and central state employees; monthly figures are EIRO calculations based on Statistics Denmark data. • Estonia: figures from ESA pay surveys. • Finland: figures from Statistics Finland. • France: figures, from INSEE, are for year to third quarter of 2005. • Germany: figures from Federal Statistical Office. • Greece: figure from Institute of Labour (INE) of the Greek General Confederation of Labour (GSEE). • Hungary: figure from KSH. • Ireland: figures, from CSO, refer to average industrial earnings in the private sector for September 2005. • Italy: hourly figures from Istat; annual figure from Bank of Italy (Banca d’Italia). • Latvia: figures, from CSP, refer to average gross monthly wages and salaries. • Lithuania: figures, from Lithuanian Statistics, are for third quarter and exclude ‘individual enterprises’. • Luxembourg: figures are based on Eurostat data for annual earnings. • Malta: figures, from National Statistics Office labour force survey, relate to July-September 2005. • Netherlands: figures, from CBS, exclude overtime. • Norway: figures, from SSB, relate to average monthly earnings in third quarter of 2004, full- time equivalents. • Poland: figure, from GUS, relates to September 2005. • Portugal: figures based on survey data from DGEEP. • Romania: figures from INS wage earnings and labour cost survey. • Slovakia: data from ŠÚ SR; 2005 figure is forecast. • Slovenia: figure is estimate from UMAR based on SURS data and refers to gross wage per employee in nominal terms, all sectors. • Spain: figures, from Ministry of the Economy and Inland Revenue, refer to average annual wages. • Sweden: hourly figures refer to blue-collar workers in private sector; monthly figures, from SCB, are for all workers.

• UK: figures, based on ONS average earnings index, are for full-time workers (excluding overtime).

Appendix 12

Back to table 15

The figures in table 15 should be read in conjunction with the following notes:

• Austria: figure from Chamber of the Economy (Wirtschaftskammer Österreich, WKÖ). • Belgium: figures from Central Economic Council (Conseil Central de l’Économie/Centrale raad voor het bedrijfsleven, CCE/CRB). • Czech Republic: figure from CSÚ. • Denmark: cash figure, from Statistics Denmark, is for private sector only; percentage increase figure from Ministry of Finance. • Estonia: figure from ESA. • Finland: figures from Statistics Finland. • Germany: figures from Federal Statistical Office. • Greece: no hourly figures available; according to data from the National Statistical Service and INE-GSEE; average monthly labour costs stood at EUR 1,683 in the third quarter of 2004 and EUR 1,697 in the same quarter of 2005. • Italy: cash figure from Bank of Italy; percentage increase figures (2005 figure is a forecast) from Istituto di Studi e analisi economica. • Latvia: figures, from CSP, are for third quarter of each year, with percentage increase from third quarter to third quarter. • Lithuania: figures from Lithuanian Statistics. • Luxembourg: 2005 figure for first nine months. • Malta: figures, from National Statistics Office labour force survey, relate to first nine months of each year and to NACE sectors C to K. • Netherlands: figures from CBS. • Poland: figure, from GUS, is for ‘cost per worked hour’; figure for ‘cost per remunerated hour’ in 2004 was PLN 19.26. • Romania: figures from INS wage earnings and labour cost survey. • Slovakia: data from ŠÚ SR. • Slovenia: no hourly figures available; according to SURS data, the average monthly labour cost per employee for the whole economy was SIT 373,835 in 2003 (up 7.6% on 2002). • Spain: 204 figure from MTAS, 2005 figure from INE and refer to third quarter of year; figures refer to ‘average labour cost per effective hour’. • Sweden: figures from SCB. • UK: figures from ONS index of labour costs per hour; 2005 figure is for first quarter; 2004 percentage increase is EIRO-calculated average of four quarterly increases.

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