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Mar 30 '23
[deleted]
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u/tobias_681 For a Europe of the Regions! 🇩🇰 Mar 30 '23
They may not be labour intensive or not produced in Denmark.
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u/DonVergasPHD Mexico Mar 30 '23
Or Danish labor is really productive.
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u/speltmord Denmark Mar 31 '23
Bingo. Sort of.
The cost of doing business in Denmark is insanely cheap compared to most so-called "poorer" countries. While wages are high, the also high taxes create a safety net that means that businesses pay much less per employee compared to, for instance, Spain. Here's a video that explains it.
This means that, in addition to productivity per hour worked, the productivity per krone spent by a business is also very high.
I wouldn't expect any significant difference to Sweden in this regard, though.
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u/Master_Bates_69 United States of America Mar 31 '23
While wages are high, the also high taxes create a safety net that means that businesses pay much less per employee compared to, for instance, Spain.
Is it easy for danish employers to fire/lay off workers?
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u/speltmord Denmark Apr 01 '23
Yes, extremely by European standards. Hiring and firing are both very cheap for both parties, which means that the job market is very flexible. This is possible because of various social safety nets, i.e. employees do not typically suffer huge personal consequences from being fired.
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u/gatobritanico Spain Mar 30 '23
It is an estimation of enterprises with 10 or more employees. For whole economy, you can refer to national accounts of each country (compensation of employees, total hours worked of employees, then calculate).
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u/chunseye The Netherlands Mar 30 '23
What kind of labour?
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Mar 30 '23
The notes say;
Whole economy (excluding agriculture and public administration); in enterprises with 10 or more employees.
So I'll imagine it includes all paid work that fits the above criteria, and doesn't include childbirth.
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u/BernieEcclestoned brexit is life Mar 30 '23 edited Mar 30 '23
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u/enigbert Mar 30 '23
those are earnings, not labour costs (the latter will include all taxes and contributions paid by the employer) . The value for UK was 25.7€ in 2016, 29.67€ in 2021, and probably 31€ in 2022
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Mar 30 '23 edited Mar 30 '23
[deleted]
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u/BernieEcclestoned brexit is life Mar 30 '23
I just took the £640 median weekly wage and divided into the normal 37.5 hourly week so it's probably my bad
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Mar 30 '23 edited Mar 30 '23
I'm still not used to not seeing us on this sort of thing.
That's surprisingly cheap, to be honest with you, given how rich we are supposed to be. Wages have been stagnating whilst costs are going crazy.
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u/tobias_681 For a Europe of the Regions! 🇩🇰 Mar 30 '23
The UK is below Slovenia?
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u/BernieEcclestoned brexit is life Mar 30 '23
Yeah, it can't be right, UK is 14th, or 10th depending on the approach, globally for wages
https://en.wikipedia.org/wiki/List_of_countries_by_average_wage
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Mar 30 '23
[deleted]
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Mar 30 '23 edited Mar 30 '23
Ah yes, because the UK is one great big monolith that all feels exactly the same way about the EU. Let's ignore the fact that the referendum result was practically half-and-half or that many Brexit voters have since either died or come to regret their decision.
Not to mention that this sub is r/Europe, not r/EU.
What a very nuanced and mature take you have.
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Mar 30 '23
[deleted]
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u/BernieEcclestoned brexit is life Mar 30 '23
Neither Norway or Iceland are in the EU yet they are included
Switzerland is 23.21 euro btw
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Mar 30 '23
Morale of the story: if you want good salaries and a Mediterranean lifestyle, move to the South of France.
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u/meh1434 Mar 31 '23
A lot of people with money are already there, so expect to commute or lose most of your salary on rent.
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u/Legomichan Catalonia (Spain) Mar 31 '23
I was born in Mallorca Spain and this happened already. Young local people that lived in the now touristic areas (close to the sea) are forced to sell their homes and move out of their villages to the interior or outside the island, now 2/3 houses sold are to wealthier Europeans, and the people that lived there for centuries had to sell and move out or be forced to live with their parents, while a Cola at a bar at summer costs half of what the waiter will make in an hour.
In my town, my parents street where i grew up has more germans and brits than people born there when i was young. Spain having high taxes based on heritage means that you will be forced to sell if you don't have a high salary (which you probably won't because all the economy revolves around tourism and those are low wage jobs), meaning you can't afford to keep your parents home (because gentrifiation made the house be worth a lot of money => higher taxes).
Funny how tourism made people more miserable instead of wealthier. Local mood is quite bleak at best.
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u/TimaeGer Germany Mar 30 '23
Interesting how Norway is more expensive than Luxembourg as Luxembourg has a way higher gdp per capita.
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u/enigbert Mar 30 '23
GDP per capita of Luxembourg is way off because they divide the total GDP by resident population, and the commuters are not included
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u/Propagandis 🇦🇺 🇩🇪 Mar 30 '23 edited Mar 30 '23
Because GDP per capita does not equal labour cost.
Labour cost also doesn't equate what people are getting paid. Countries have different ways of raising revenue. If a country has a high payroll tax, it equates to higher labour costs but not necessarily that people are getting paid more.
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u/rbnd Mar 31 '23
Labour cost per hour is strongly correlated to the nominal GDP per hour worked.
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u/Propagandis 🇦🇺 🇩🇪 Mar 31 '23
Of cause it's strongly correlated. I was trying to explain how a country with a higher GDP can still have lower labour cost in this graph
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Mar 31 '23
Luxembourg is a tax heaven and that inflates gdp. Since they are also a small country that is even more true. You have a similar story in Ireland.
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u/Ztarphox Kingdom of Denmark Mar 31 '23
What's the matter Sweden, can't afford to pay your workers?
/s
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u/Fishamatician United Kingdom, still geographicaly Europe. Mar 31 '23
I keep seeing things like this and thinking hey the UK is missing..... Oh yeah. 😞
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u/marioquartz Castile and León (Spain) Mar 30 '23
Some dumbs are parroting that labour costs in Spain are "too high". That is better hire someone in Germany. Well... Data disagree with that parroting.
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u/aftermath223 🇷🇴 stealing jobs in 🇩🇰 Mar 30 '23
not saying it’s not true, but you also need to account for productivity in those hours. as far as I remember Spain had pretty low employee productivity
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u/marioquartz Castile and León (Spain) Mar 30 '23
Germany 99.5
Spain 102
https://tradingeconomics.com/country-list/productivity
Germany $65.5 per hour | 26.3 hours per week (average)
Spain $51.0 per hour | 26.3 hours per week (average)
https://time.com/4621185/worker-productivity-countries/Data disagree with your disinformation and myths. A diference of 14.5$ is not so high when is the same value UK have.
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u/aftermath223 🇷🇴 stealing jobs in 🇩🇰 Mar 30 '23 edited Mar 30 '23
according to the Times one, it seems that indeed Germany is about ~30% more productive per hour, so I wasn’t completely off the mark. but while the salaries seem to be almost double, it shouldn’t be more attractive.
For future cases, you should maybe consider not being so aggressive off the mark. I was using some clear qualifiers to my statements, such as “as far as I remember”, “not saying that you are wrong”, etc. Calling that as “disinformation and myths” really brings no value to the discussion.
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u/dont_trip_ Norway Mar 30 '23 edited Mar 17 '24
dog violet worm attraction disarm six vast threatening fertile normal
This post was mass deleted and anonymized with Redact
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u/predek97 Pomerania (Poland) Mar 30 '23
Data disagree with your disinformation and myths
Dude, you've literally shown that it's 30% more in Germany...
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Mar 31 '23
It's odd, why are the wages so different between the UK and Spain then?
I'd assumed it was due to differences in industries but that would be reflected in the productivity statistics?
I guess maybe the high unemployment (one of the highest in the EU) provides a strong downward pressure on wages.
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u/tobias_681 For a Europe of the Regions! 🇩🇰 Mar 30 '23
You can't do a 1:1 comparison because you get different things. You have to factor in unit labour costs and infrastructural advantages. German economy is more capital-intensive and thus more productive per working hour and its in the heart of Europe with a very dense infrastructure grid. If wages were the same a company would always chose Germany. If you look at the last 30 years Germany massively deflated their unit labour costs relative to the rest of the Eurozone.
Here you can see that relative to 2000 Spain has become more expensive faster than Germany. This is not on Spanish wages growing too fast though but on German wages growing too slow. Still what you can see around 2008 was Spanish wages growing too fast and German wages growing too slow simultaneously - resulting in disaster. As you can see unit labour costs in Spain have come down significantly since then, though that's not necesarilly a good thing as this kind of policy stifles the domestic market and we can't all only export stuff all the time. Someone has to buy it. The world economy is zero sum in that sense. We can't export our stuff to Mars. Someone has to have a negative CAB. And well, if there are no buyers we will run into deflation and recession and probably fascism too.
The new German government has lifted minimum wages significantly though, so the balances from the past may shift but regardless of anything the entire Eurozone should aim to meet the 2 % inflation target on wages to get out of deflation spirals and spur growth.
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u/Saires Mar 30 '23 edited Mar 30 '23
Data is wrong. Just look at "excluding X, Y, Z..."
Median in Germany is 4 105€/Month in 2022.
Lets calculate with 38h/week and not 40.
4 105/4.3 weeks per month/38h per week= 25.1€/h
25€/h is far away from listed 40€/h.
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u/NooBias Mar 30 '23
25€/h is far away from listed 40€/h.
it's 30€/h not 40. The yellow line is comparable to what are you calculating. And considering the exclusions it's pretty close to your calculation.
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u/Saires Mar 30 '23 edited Mar 30 '23
25€/h and 30€/h makes a huge difference. That is a 20% increase.
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u/enigbert Mar 30 '23
labour costs include all the taxes and contributions paid by the employers (the blue parts in the image)
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u/harry6466 Mar 30 '23
Labor "costs" sounds like a drag for companies that needs to be minimalized, especially within neolib thought. But remember if labor costs would be zero, the people working are slaves.
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u/Le_Doctor_Bones Scandinavia Mar 31 '23
No, labour costs should preferably be high since that would mean productive workers who are, at least in a market society, worth as much as paid and have the money to consume a lot of products.
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u/allebande Mar 30 '23
And this chart right here, folks, is the reason why Eastern Europe is growing faster than Western Europe. Despite some shiny looking figures, there is still A LOT of catch up to do.
I mean literally. Szczecin and Bratislava are like 1 hour away from Berlin and Vienna and yet have less than half their labour costs, while maintaining freedom of movement and all the perks of EU and Schengen. From a company and investment perspective, that's literally heaven. Imagine if the US and Mexico had freedom of movement and a common legal framework - Mexico would get absolutely flooded with investment.
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u/Valaxarian That square country in center with 7 neighboring countries Mar 30 '23
Get used to high prices like us
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u/Rizzan8 West Pomerania (Poland) Mar 31 '23
Lol, no wonder my Norwegian HQ prefers to move most of the work to Poland, Romania and Bulgaria.
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u/morbihann Bulgaria Mar 30 '23
Yep, and somehow we are paying about the same price for pretty much anything.