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System of unit labour cost, OECD – Updated: June 2014

OECD Unit Labour Costs up 0.4% in the first quarter of 2014 as labour productivity falls

Download the entire news release (PDF 1MB)

19/06/2014 – Unit labour costs (ULCs) in the OECD area increased by 0.4% in the first quarter of 2014, compared with 0.1% in the previous quarter. Labour compensation per unit of labour input rose by 0.3%, whereas labour productivity (GDP per person employed) fell by 0.2%; the first fall in labour productivity since the fourth quarter of 2012.

ULCs increased significantly (by 1.1%) in the United States, at least partly reflecting the impact of the severe winter on output and labour productivity, which fell by 1.1%. ULCs in Japan fell significantly (minus 1.8%), driven by labour productivity gains (1.8%), which may have been temporarily boosted as output rose in anticipation of the April increase in consumption tax. In both Japan and the United States, labour compensation was flat. ULCs rose by 0.2% in the Euro area in the first quarter of 2014, driven by increasing labour compensation (0.4%) and marginal labour productivity gains (0.1%).

Within the Euro area, the adjustments in ULCs continued but not in all countries. ULCs declined significantly in Greece (minus 2.2%), driven by a significant fall in labour compensation (minus 2.6%). ULCs also decreased in Spain (minus 0.8%), reflecting falling labour compensation (minus 0.6%) and rising labour productivity (0.2%). On the other end, following two successive quarters of marginal growth, ULCs increased significantly in Italy (by 0.9%), driven by rising labour compensation (0.9%). Rising labour compensation (0.5%) also drove up ULCs in France (0.4%), where labour productivity growth was flat. Labour compensation costs also rose in Germany (0.6%) but robust productivity growth (0.5%) checked growth in ULCs (0.1%).

Compared with the same quarter of the previous year, ULCs in the OECD area rose in the first quarter of 2014 by 0.6%, compared with flat ULC growth in the fourth quarter of 2013.

Read more: http://www.oecd.org/std/labour-stats/system-of-unit-labour-cost-oecd-updated-june-2014.htm

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