Labour costs up 8.9% in 1Q23 according to Banco de España

labour market

According to the advance data on the evolution of the main magnitudes of the behaviour of the domestic business fabric provided every three months by the Bank of Spain through what it calls the Central Balance Sheet Data Office, the average remuneration of workers in Spanish companies increased by 5.9% in the first quarter of the year, above the average inflation for the period and well above the 2.8% average improvement recorded last year, according to the ABC newspaper.

According to the Bank of Spain’s Central Balance Sheet Data Office, companies’ labour costs increased by 8.9% between January and March, not only because of wage rises but also because of higher contributions.

Wages are improving and the incorporation of workers into companies is slowing down significantly. While last year the average workforce of the sample of around a thousand companies used by the Bank of Spain to provide this advance information grew by 3.7%, this year the rate is somewhat lower at 2.2%.

The ordinary results of companies improved by 68% in the first quarter despite the stagnation of turnover and despite the fact that profits fell in 45% of companies. The figure underlines one of the mantras that the institution governed by Pablo Hernández de Cos has been stressing, namely that the evolution of corporate profits is an uneven phenomenon, with different readings depending on the sector in question.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.