14 June 2019
N° 2019-154

In Q1 2019, the labour cost index - wages and salaries increased by 1.5%, the total labour cost index increased by 1.2%Labor cost index in industry, construction and services - first quarter 2019

In the first quarter of 2019, the labour cost index (LCI) - wages and salaries in the non-farm business sector accelerated sharply : +1.5% quarter on quarter, after +0.5% in Q4 2018 (seasonally adjusted data). Without the special bonus for purchasing power (PEPA) it would have remained stable in the first quarter. Year on year, the LCI – wages and salaries rose by 2.9%, a larger increase than in the fourth quarter (+2.1%). The average working time slightly increased in the first quarter (+0.3% y-o-y).

Informations rapides
No 154
Paru le : Paru le 14/06/2019
Informations rapides  No 154 - June 2019
Warnings

- From this release and in accordance with European regulations, the base year for the labour cost index is 2016 : the average of the four 2016 quarterly indices is equal to 100. This change of base year has no impact on the evolutions of the index (quarter-over-quarter as well as year-over-year).

- Some employers’ social contributions taken into account in the labour cost index have been updated with the results of the French part of the 2016 European Labour Cost Survey. This leads to slight downward revisions in average annual evolutions (around 0.2 to 0.3 points each year).

- On 1st January 2019, the tax credit encouraging competitiveness and jobs (CICE) was transformed into a permanent reduction in employers’ social contributions of an equivalent amount. In concrete terms, this means abolishing the tax credit as such, and creating a uniform 6-point reduction in the rate of employers' social contributions applicable to salaries up to a maximum of 2.5 times the minimum wage (the rate reduction, as well as the base, are equal to those of the CICE in metropolitan France before its abolition). This transformation is neutral on the labour cost index.

- As part of the economic and social emergency measures adopted by the French Parliament in December 2018, firms might pay a special bonus for purchasing power (PEPA) in the first quarter of 2019, to employees earning less than 3 times the minimal wage. This bonus, which is free of income tax and social contribution up to 1’000€, boosts the labour cost index – wages and salaries by 1.5 points and the total labour cost index by 1.0 point in Q1 2019.

- Following the merger of the supplementary pension schemes AGIRC and ARRCO, the corresponding social contribution rates were modified on 1st January 2019, increasing by 0.3 points the total labour cost index.

The wages and salary costs increased by 1.5%

In the first quarter of 2019, the labour cost index (LCI) - wages and salaries in the non-farm business sector accelerated sharply : +1.5% quarter on quarter, after +0.5% in Q4 2018 (seasonally adjusted data). Without the special bonus for purchasing power (PEPA) it would have remained stable in the first quarter. Year on year, the LCI – wages and salaries rose by 2.9%, a larger increase than in the fourth quarter (+2.1%). The average working time slightly increased in the first quarter (+0.3% y-o-y).

LCI - wages and salaries: Year-on-year changes

LCI - wages and salaries: Year-on-year changes
Total Industry Construction Services
2012-Q1 1.7 2.5 0.3 1.5
2012-Q2 2.1 2.3 1.6 2.1
2012-Q3 2.5 2.5 2.4 2.5
2012-Q4 2.5 2.3 2.2 2.6
2013-Q1 2.2 2.1 2.2 2.2
2013-Q2 2.5 2.6 2.2 2.4
2013-Q3 2.3 2.7 2.1 2.2
2013-Q4 2.1 2.3 1.9 2.1
2014-Q1 2.2 2.3 2.5 2.1
2014-Q2 1.6 1.7 1.3 1.5
2014-Q3 1.4 1.6 0.9 1.3
2014-Q4 1.1 1.8 0.8 0.8
2015-Q1 1.4 1.8 1.1 1.2
2015-Q2 1.4 1.7 1.5 1.2
2015-Q3 1.4 1.6 1.0 1.3
2015-Q4 1.7 1.9 2.1 1.5
2016-Q1 1.4 1.8 1.4 1.3
2016-Q2 1.4 1.7 1.5 1.3
2016-Q3 1.3 1.5 2.5 1.1
2016-Q4 1.0 1.3 1.6 0.9
2017-Q1 1.6 1.8 3.0 1.5
2017-Q2 1.6 2.1 3.1 1.3
2017-Q3 1.6 2.3 2.4 1.3
2017-Q4 1.8 1.8 3.7 1.6
2018-Q1 1.6 2.1 0.8 1.5
2018-Q2 1.8 1.8 1.7 1.9
2018-Q3 2.0 1.8 2.6 2.1
2018-Q4 2.1 2.0 0.7 2.3
2019-Q1 2.9 3.3 5.2 2.6

LCI - wages and salaries: Year-on-year changes

  • Scope: non-agricultural market sector excluding services to households.
  • Sources: ACOSS, DARES, INSEE.

Wages accelerated sharply in industry and construction, but more softly in services

In Q1 2019, wages in industry accelerated sharply over the quarter (+2.4% after +0.3% in Q4 2018) and over the year (+3.3% after +2.0%).

Wages in construction also rose very strongly (+2.9%) after being almost stable in Q4 2019 (-0.1%).

In Q1 2019, wages in services accelerated more softly quarter on quarter (+1.1% after +0.6% in the fourth quarter) and year on year (+2.6% after +2.3%). The acceleration is sharp in financial and insurance activities (+3.3% q-o-q in the first quarter after +0,6%), in wholesale and retail trade (+1.7% after +0.3%) and in accommodation and food services activities (+1.3% after +0.1%). It is softer in other sectors. In contrast, wages in professional, scientific and technical activities declined (-0.9%) after an increase to the same extent in the previous quarter (+0.9%)

LCI - wages & salaries

SA - base 100 in 2016
LCI - wages & salaries (SA - base 100 in 2016)
Quarterly variations (%) Yearly variations(%)
Q4-2018 Q1-2019 Q4-2018 Q1-2019
Industry 0.3 2.4 2.0 3.3
Mining and quarrying 0.5 4.1 3.2 5.8
Manufacturing 0.3 2.3 2.0 3.3
Electricity, gas, steam and air conditioning supply 0.6 1.7 2.9 1.6
Water supply; sewerage, waste management and remediation activities 0.4 4.4 1.8 6.5
Services 0.6 1.1 2.3 2.6
Wholesale and retail trade; repair of motor vehicles and motorcycles 0.3 1.7 1.8 2.8
Transportation and storage 0.7 0.9 2.5 2.4
Accommodation and food service activities 0.1 1.3 1.5 2.4
Information and communication 0.4 0.8 2.1 1.6
Financial and insurance activities 0.6 3.3 2.5 4.6
Real estate activities 1.9 1.0 4.2 4.0
Professional, scientific and technical activities 0.9 -0.9 3.4 1.6
Administrative and support service activities 0.2 1.1 1.5 2.4
Construction -0.1 2.9 0.7 5.2
TOTAL 0.5 1.5 2.1 2.9
  • Scope: non-agricultural market sector excluding services to households
  • Sources: ACOSS, DARES, INSEE

Slight downward revision of LCI – wages and salaries in Q4 2018

The Q4 2018 quarterly variation in LCI - wages and salaries in the non-farm business sector has been revised downwards by 0.1 percentage points due to additional workforce and worked hours data.

The total labour cost index increased by 1.2%

In the first quarter of 2019, the total labour cost index in the non-farm business sector accelerated sharply over the quarter (+1.2% after +0.5% – seasonally adjusted data). It increased by 2.8% over the year, nearly at the same pace as in the previous quarter (+2.9%).

LCI - total labour cost: year-on-year changes

LCI - total labour cost: year-on-year changes
Total Industry Construction Services
2012-Q1 1.9 2.9 0.7 1.7
2012-Q2 2.3 2.6 2.0 2.3
2012-Q3 2.5 2.8 2.5 2.4
2012-Q4 2.4 2.5 2.2 2.4
2013-Q1 0.4 0.3 0.1 0.4
2013-Q2 0.6 0.7 0.1 0.6
2013-Q3 0.6 1.0 0.3 0.6
2013-Q4 0.3 0.4 0.0 0.4
2014-Q1 1.4 1.4 1.7 1.4
2014-Q2 0.7 0.8 0.4 0.7
2014-Q3 0.4 0.6 -0.1 0.4
2014-Q4 0.2 0.8 0.0 -0.1
2015-Q1 0.8 1.2 0.4 0.6
2015-Q2 0.8 1.1 0.8 0.6
2015-Q3 0.8 1.0 0.3 0.7
2015-Q4 1.0 1.2 1.3 0.8
2016-Q1 1.8 1.9 2.3 1.6
2016-Q2 1.1 1.2 1.9 1.0
2016-Q3 0.9 0.9 2.8 0.7
2016-Q4 0.6 0.6 1.9 0.4
2017-Q1 0.5 0.8 2.5 0.3
2017-Q2 1.0 1.8 2.9 0.6
2017-Q3 1.1 1.9 2.3 0.8
2017-Q4 1.5 1.6 3.8 1.3
2018-Q1 2.1 2.6 1.4 2.1
2018-Q2 2.6 2.4 2.4 2.7
2018-Q3 2.8 2.4 3.3 2.9
2018-Q4 2.9 2.6 1.2 3.2
2019-Q1 2.8 3.0 4.6 2.6

LCI - total labour cost: year-on-year changes

  • Scope: non-agricultural market sector excluding services to households.
  • Sources: ACOSS, DARES, INSEE.

Slight downward revision of LCI – total labour cost in Q4 2018

The Q4 2018 quarter-on-quarter variation in total labour cost index in the non-farm business sector has been revised upwards by 0.2 percentage points and the year-over-year variation remained unchanged.

LCI - total labour cost

SA - base 100 in 2016
LCI - total labour cost (SA - base 100 in 2016)
Quarterly variations (%) Yearly variations (%)
Q4-2018 Q1-2019 Q4-2018 Q1-2019
Industry 0.4 1.9 2.6 3.0
Mining and quarrying 0.5 3.6 3.7 5.4
Manufacturing 0.3 1.8 2.6 2.9
Electricity, gas, steam and air conditioning supply 0.6 1.7 3.1 1.6
Water supply; sewerage, waste management and remediation activities 0.4 4.1 2.5 6.4
Services 0.7 0.8 3.2 2.6
Wholesale and retail trade; repair of motor vehicles and motorcycles 0.4 1.5 2.8 3.0
Transportation and storage 0.8 0.5 3.5 2.2
Accommodation and food service activities 0.2 1.2 2.7 2.7
Information and communication 0.4 0.7 2.5 1.6
Financial and insurance activities 0.6 2.3 2.9 3.6
Real estate activities 2.0 0.6 4.7 3.7
Professional, scientific and technical activities 1.0 -1.0 4.0 1.5
Administrative and support service activities 0.6 0.9 2.9 2.9
Construction -0.2 2.4 1.2 4.6
TOTAL 0.5 1.2 2.9 2.8
  • Scope: non-agricultural market sector excluding services to households
  • Sources: ACOSS, DARES, INSEE


: bureau-de-presse@insee.fr
: