Euro area labour costs rise 3.1% as construction wages jump 3.9%

Eurostat published its labour cost index for the second quarter of 2026 on 16 September.

The figures

Compared with the second quarter of 2025:

• Euro area hourly labour costs: up 3.1%, made up of a 3.0% rise in wages and salaries and a 3.2% rise in non-wage costs (employers' social contributions and similar costs)
• EU hourly labour costs: up 3.2%, with wages and non-wage costs both up 3.2%

By sector (euro area)

• Construction: +3.9%, the fastest-growing sector
• Services: +3.0%
• Industry: +2.9%
• Non-business economy (mainly public administration, education and health): +3.1%
• Business economy: +3.0%

Across the EU, the activities with the largest wage increases were real estate (+5.7%), other service activities (+5.1%) and administrative and support services (+4.8%). Mining and quarrying recorded the smallest rise (+1.5%), and professional, scientific and technical activities saw wage costs fall 0.4%.

Why it matters for the euro

Labour costs feed directly into the European Central Bank's read on domestic inflation pressure, separate from the energy-driven price rises Eurostat flagged in its August inflation data (report). A 3.1% rise in hourly costs, running above the ECB's 2% inflation target, is one reason wage growth stays on the list of things the ECB watches even as it manages an energy shock; the ECB raised its deposit rate to 2.50% on 10 September (report). The next labour cost release, covering the third quarter, is due 17 December. Live prices: EUR/USD.