Total labour costs per hour increased by 0.9% between the 2nd and 3rd quarter of 2009 in the economic activity of Manufacturing. During the same period the total labour costs per hour decreased by 4.4% in the economic activity of Transport, storage and communication, by 3.8% in Wholesale and retail trade; repair and by 2.3% in Construction.
Total labour costs excluding bonuses increased between quarters by 4.3% in Manufacturing. During the same period the total labour costs per hour decreased by 2.4% in the economic activity of Transport, storage and communication, by 1.5% in Wholesale and retail trade; repair and by 1.1% in Construction.
Annual total labour costs increased in all economic activities. The increase ranged from 1.8% in Transport, storage and communication to 4.4% in Manufacturing.
According to an agreement between the Confederation of Icelandic Employers and the Icelandic Confederation of Labour (on behalf of its member unions) wage increases that were supposed to come into effect 1 March 2009 came partly into effect in 3rd quarter. The wages increased by 6,750 ISK 1 July 2009. The labour cost index also reflects increase in Payroll tax from last July. The increase was from 5.34% to 7.0%.
The labour cost index measures, on a quarterly basis, the development of labour costs per hour worked. The index is not adjusted to changes in working hours or labour structure.