Collectively agreed wage increases above inflation in 2003

12/01/2004 10:00

In 2003 wage levels agreed under the collective labour agreements rose by 2.8 percent. This is less than in 2001 and 2002, when they rose by 4.4 and 3.6 percent respectively. Naturally, wages rise by less when the economy comes under pressure. This was also the case at the beginning of the nineties.

What is remarkable is the substantial increase in the wage level once inflation has been deducted (2.1 percent). This increase was 0.6 percent in 2003. On average employee wages rose by about 0.3 percent point per year more than inflation since 1990. Only in 1994 and 1995 did collectively agreed wage levels rise by less than inflation.

Collectively agreed hourly wages rates (including bonuses)

Collectively agreed hourly wages rates (including bonuses)

One third of collective agreements for 2004 definite

In the second half of last year, central employer and employee organisations agreed not to raise wages in the new collective labour agreements for 2004, although results-related bonuses were allowed.

As agreements on wage levels in 2004 had previously been reached in some sectors, the average wage increase in 2004 will be above zero. One third of collective labour agreements for 2004 have now been finalised.

Largest wage increase for government sector

The collective wage increase in 2003 was largest in the public sector: 3.2 percent, compared with 2.7 percent in the private sector. The difference is caused by the increase in contractual bonuses in the government sector, such as end-of-year bonuses. If these are left out of account the increase in the government wages would be 2.6 percent, slightly less than in the private sector.

Collectively agreed wage increases in private and public sector

Collectively agreed wage increases in private and public sector

Government bonuses catching up

In the last three years public sector employers have expanded their bonus system, while private sector bonuses have hardly changed. This means government employees have nearly caught up with private sector employees as far as received bonuses are concerned. On top of their regular wage, government employees now receive 11.4 percent extra in bonuses, compared with 8.3 percent in 1995. In the private sector employees receive 11.8 percent in extra bonuses.

Han van den Berg

Source: StatLine