According to data released by the National Statistics Institute (INE), in 2023 labour costs increased by 5.3%, year-on-year. The 5% increase in salary costs contributed to this evolution.

“In 2021, the Labour Cost Index increased by 5.3% (it had increased by 3.2% in 2022), corresponding to increases of 5% in salary costs (3.0% in 2022) and 6.4% in other costs (4.1% in 2022)”, highlights the statistics office, in the highlight published this morning.

It is important to explain that salary costs cover not only the salary itself but also regular bonuses and allowances, payment for overtime work and irregular bonuses and allowances (such as the Christmas bonus).

Other costs relate to taxes, social contributions, redundancy payments and optional charges, such as health insurance.

Data released by INE show that it was in the public sector that labour costs increased most in the last year. There the year-on-year increase was 6% (it had been 1.6% in 2022), while in the private sector, it was 4.9% (it had been 4.1%).

The last year was synonymous with several changes in the salaries of public servants — that is, not only salary increases but also reinforcements in some specific careers —, which helps to understand this evolution.