Euro area hourly labor costs rose 3.4% YoY in Q1 2025, down from 3.8% YoY in Q4 2024 and the lowest since Q3 2022.

• Wage growth slowed to 3.4% YoY, down from 4.1% YoY in the previous quarter and the weakest since Q3 2022.
• The non-wage component of labor costs increased 3.4% YoY, up from 2.7% YoY previously.
• By sector in the euro area, labor costs increased 4.7% YoY (prev 4.2% YoY) in construction, 4.3% (prev 3.8% YoY) in services, and 2.5% (prev 4.2% YoY) in industry.
• Professional, scientific & technical activities saw the largest wage (+7.4%) and non-wage (+6.2%) increases.
• Romania (+16.1% YoY), Croatia (+13.5%), and Bulgaria (+13.0%) recorded the highest national wage growth; Malta (+1.6%) and France (+1.9%) had the lowest.