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Slower wage-cost increase in Belgium than in its neighbours

When all reductions in employers’ contributions and the effects of the tax shift are factored in, the cumulative increase in wage costs in Belgium since 1996 should be one percentage point lower in 2018 than the average for its three neighbours, the Central Economic Council says in a report released on Monday. In 2018, as in previous years, Belgium’s wage-cost increase was higher than Germany’s – by 3.1 percentage points – but lower than those of France (by 3.8 points) and the Netherlands (by 8.7 points).

When the tax shift is not factored in, the handicap is 0.6 points against the average of the three neighbouring countries, with only Germany having a lower increase (-4.8 points) in wage costs.

The 0.6-point figure should be taken into consideration in negotiations between the social partners since, legally, the tax shift cannot be considered in thatcontext.

In 2015, Belgium had had a handicap of 2.8 percentage points compared to its neighbours, while in 2010, the gap was 5.4 percentage points.

The figures released on Monday are provisional and are to be updated during the course of the year.

The Brussels Times