Informations Rapides · 7 July 2023 · n° 175

The all employees-revised index of hourly labour cost - (ICHTrev-TS) Hourly labour cost index - first quarter 2023

In the first quarter of 2023, the payroll increased significantly more than the number of hours paid by employers, so that hourly wages increased. This increase was the result of the inflation being taken into account in wage negotiations as well as the automatic 1.81% increase in the minimum wage on 1st January. However, at the start of 2023, wage dynamics were adversely affected by the significant payments of the Value Sharing Premium (PPV) in the fourth quarter of 2022: €1.1 billion were paid to employees in the non-farm business sector excluding household services in the first quarter of 2023, compared with €3.3 billion in the previous quarter. This scheme, which replaced the special bonus for purchasing power, allows firms to pay, between July 2022 and December 2023, up to 3,000 euros of bonuses per calendar year and per employee (and even 6,000 euros in the case of a profit-sharing agreement), free of social security contributions and income tax.

In addition, the “1 young person, 1 solution” plan, launched at the end of July 2020, contributed to labour cost variations until the first quarter of 2023. As part of this plan, from January 2023, employers are eligible, under certain conditions, for aid of up to €6,000 to hire a young worker with a sandwich course contract.

The ICHTrev-TS is primarily intended for users who need indicators of labour costs to upgrade their contracts. Therefore, this index is not usually subject to any revision once it has been published (however one exception was made in January 2021). It is a monthly index (base 100 in December 2008) that is published every quarter for all industries.

The index of employer contributions has been published since April 2010 (base 100 in December 2008). It differs from the ICHTrev-TS in two ways: the three monthly indices of a same quarter are identical and there is no forecast for the mechanical and electrical industries as far as the first month of the next quarter is concerned. This index of employer contributions measures the change in the variable “1 + rate of employer contributions” where the rate of employer contributions is the percentage of employer social contributions and taxes minus subsidies based on wages and employment, relative to gross salary (see methodological note in the “Documentation” tab on the webpage of this publication).