Collectively negotiated wages 1.6 percent up in 2012

Collectively negotiated (CAO) wages rose by 1.6 percent last year, i.e. 0.5 percentage points more than in 2011. The inflation rate over 2012 was 2.5 percent and has been above the increase in collectively agreed wages for the past thirty months. Contractual wage costs rose by 2.2 percent in 2012.

Collectively agreed wages and contractual wage costs

Not much difference between the various industrial sectors

The rise in collectively agreed wages is almost the same for all industrial sectors and varies between 1.3 and 1.8 percent except in the sector hotels and restaurants, but there are considerable differences compared to the previous year. For example, a wage freeze was imposed for the entire public administration sector in 2011, but in 2012 wages in this sector grew by 1.5 percent. This is mainly due to the fact that the collective wage agreement for municipal employees included two wage increases and a one-off bonus. The difference from the preceding year is also relatively large in the construction sector. Wages in the construction sector were raised by 0.8 percent in 2011 versus 1.8 percent in 2012.

Collectively agreed wage increase by industrial sector

Contractual wage costs 2.2 percent up

Contractual wage costs were raised by 2.2 percent last year due to a collectively agreed wage increase and higher social contributions. The employers’ contribution to the unemployment insurance scheme was raised from 4.20 to 4.55 percent in 2012. The employers’ contribution to health care costs also changed. Contractual wage costs in the sector collectively negotiated wages increased considerably by 2.6 percent, caused by higher contributions to the National Civil Pension Fund (ABP).

Increase contractual wage costs by sector

Share collective wage agreements varies by sector

Last year, 80 percent of total collectively negotiated wage agreements were concluded, but the share varies according to sector. In the subsidised sector and the private sector 97 and 84 percent respectively of collectively negotiated wage agreements were concluded, but for the public sector only half of agreements, e.g. defence, police and municipal employees have been concluded so far.

Monique Hartog and Dick ter Steege