In 2008, total annual labor costs per full-time worker amounted to 56,090 euro in the West German industry. In East Germany the figure was 37,140 euro, one third less than in West Germany. This cost advantage has remained relatively stable over the last few years. Within the German service sector labor costs in 2008 varied between 35,620 euro in the retail and 72,820 euro in the banking sector. The overall cost structure did not change much. Total labor costs rose slightly slower than wages mainly because of the reduction of employer contributions to social insurance. The share of total labor costs which is determined by legal requirements and can, therefore, not be agreed upon voluntarily by the contracting parties makes up 24.8 percent in the West German industry and 26.7 percent in the East German industry. This is about the same level as at the beginning of the 1990s. Since 2000, however, the share of legally fixed labor costs has decreased slowly but steadily.

More information:
Christoph Schröder, Phone +49 221 4981-773, , DOI: 10.2373/1864-810X.09-02-05