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Labor Market

German labor costs way above EU average

Statistical data have confirmed that labor costs in Germany's private sector are much higher than in most other European Union countries. Some analysts fear the nation's competitiveness is increasingly at stake.

Germany's National Statistics Office (Destatis) reported Tuesday that labor costs in the private sector were about a third higher than the average country in the 27-member European Union.

In 2012, private employers in Europe's biggest economy paid roughly 31 euros ($40) per hour for wages and non-wage costs, Destatis said, adding that Germany thus took 8th place in the list of EU nations.

The average pay per hour in the European Union was put at 24 euros, while in the 17-member eurozone employers paid an average of 30.10 euros per hour.

Nervous industry organizations

The statistics office said labor was most expensive in Sweden, with 41.90 euros paid per hour, while it was cheapest in Bulgaria at 3.70 euros.

German labor reform package in hindsight

Destatis noted that between 2001 and 2010, labor costs in Germany climbed slower than the EU average. "But in 2011 and 2012, we've seen a reversal of that long-term trend," the office said in a statement.

Some industry leaders said they feared mounting competition, with Germany as a business location becoming less attractive. "Important indicators such as labor costs and energy prices show that Germany is losing out against its rivals," said the head of the Federation of German Wholesale, Foreign Trade and Services (BGA), Anton Börner.

hg/hc (Reuters, dpa)

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