Employers pay much more in pension premiums

05/09/2006 14:00

Between 2000 and 2004 labour costs per hour worked in the Netherlands increased by over a fifth.  The share of pension premiums in the social contributions payable by employers continues to rise. Their share in labour costs increased from 4 percent in 2000 to 8 percent in 2004.

Labour costs in financial institutions increase most

In 2004 the average labour costs per hour worked in the private sector in the Netherlands was 28 euro. This is over 20 percent more than in 2000, when an hour of work costs the employer 23 euro.
Labour costs in mining, quarrying and extraction were way above average in 2004 with 48 euro per hour worked. The labour costs in financial institutions and energy and water companies were also relatively high with 44 and 40 euro per hour worked respectively. 
The fastest increase in labour costs occurred in financial institutions: with a 35 percent hike between 2000 and 2004. 

Labour costs per hour worked

Wages make up three quarters of the labour costs

Labour costs include the wages of employees, social contributions payable by employers and other costs. Wages make up over three quarters of labour costs, both in 2000 and in 2004.

Structure of labour costs

Share of pension premiums doubled

The share of social contributions in labour costs rose from over 20 percent in 2000 to over 21 percent in 2004. Pension premiums increased most. In the period 2000–2004 the share that employers paid in pension premiums doubled from over 4 to 8 percent of the labour costs. This was offset by a decrease in the share of other social contributions, such as disablement benefits (WAO) and unemployment benefits (WW) premiums.

Pension premiums increased most in mining

The branch of industry with the highest labour costs, namely mining, quarrying and extraction, also had the steepest increase in pension premiums between 2000 and 2004. The premium share increased from 3 percent in 2000 to almost 13 percent in 2004. The lowest increase was found in hotels and restaurants, where pension premiums increased from 3 percent in 2000 to over 4 percent of labour costs in 2004.

Share of pension premiums in labour costs

Mark Zuiderwijk