Index of labour costs

The labour cost index

Measures changes in total labour costs, direct labour costs ad indirect labour costs per hour. Total labour costs are the sum of direct labour costs and indirect labor costs.

Direct labour costs

Include wages and salaries, remuneration and other cash payments like paid annual leave, sickness pay, representation allowances. In other words, payment for hours not worked are also included in direct labour costs. The main sources for direct labour costs are wage totals and wage index.

Wages and other remuneration

Contains basic paid salaries and other cash payments, among others, sitting-allowances paid to committee members, paid annual leave, sickness pay, representation allowances, and benefits from cashing in or selling options in employment relations.

Payment for hours not worked

Includes, among other things, paid annual leave, sickness pay, pay for various leave of absence and expenses on extra holidays.

Indirect labour costs

Include salaries in kind, costs for health and safety, social contributions, training costs and taxes on labour. The main sources for indirect labour costs are the labour cost survey for training costs, costs for health and safety, most social contributions and some of the salaries in kind, and the wage totals for some social contributions and most salaries in kind.

Salaries in kind

Is a common term for benefits besides the usual salaries. It includes, among other things, costs in connection with free cars, car allowances, free telephones, free newspapers, various welfare initiatives and taxable salaries in kind. Taxable salaries in kind are got from The Register of End of the Year Certificate, which includes, among other things, collective insurance contributions, free food and lodging, toll or monthly travel cards paid by the employer, free electricity, free housing, holiday trips paid by the employer and benefits from contributions to kindergartens for employees' children.

Costs of health and safety

Include costs of health services provided by the company, and costs of various workplace safety initiatives to the benefit of employees.

Social contributions

Are expenditures on pension schemes and insurance such as insurance against occupational injury and insurance against accidents.

Training costs

Include, among other things, the costs of participation in external courses and further education paid for by the employer, the costs of running schools and courses run by the company, the costs of recruitment and the costs of training new employees.

Hours worked

The index shows changes in labour costs per hour. The data sources have information on contractual working hours and the number of overtime. Hours worked are the sum of contractual working hours and overtime.

Before 2009 the industrial classification in the Labour Cost Index is defined by economic activities according to Standard Industrial Classification SN2002 , which is the Norwegian version of International Industrial Classification, also known as NACE Rev. 1.1.

From 2009 a new version of Norwegian Standard Industrial Classification SIC2007 is in use, which is in accordance with the EU’s new NACE Rev. 2.