December 18, 2024
The indicators will be released regularly at 10am on Wednesdays in the week following the monetary policy meeting. The December ECB Wage Tracker suggests that negotiated wage pressures will generally ease in 2025 compared to 2024.
The European Central Bank (ECB) has published four new wage tracking indicators on the ECB data portal, covering a total of seven euro area countries.
The headline ECB wage tracking indicator negotiated wage growth by smoothing lump sum payments in the euro area. Currently, negotiated wage increases are expected to moderate to 4.7% in 2024 (based on an average coverage rate of 47.4% for employees in participating countries) and 3.2% in 2025 (based on an average coverage rate of 32%). shown. On a monthly basis, the index is expected to peak at 5.4% at the end of 2024, the highest since the series began in January 2013.
chart 1
ECB Wage Tracker: Long-term trends and forward-looking signals in negotiated wages
Total sample period
2023-25
(Left scale: annual growth rate (percentage), right scale: percentage of employees)
Source: ECB calculations based on data provided by Deutsche Bundesbank, Bank of Greece, Bank of Spain, Banque de France, Bank of Italy, Dutch National Bank, Dutch Employers Association AWVN and Eurostat.
Note: See technical details at the end of this press release. The solid line corresponds to the period for which information exists for both the Wage Tracker and the Negotiated Wage Index (until September 2024). The dashed line indicates the period for which only the ECB wage tracker is available and therefore represents forward-looking information. The latest data observations are from November 2024. Forward-looking information covers the period through December 2025.
The ECB’s wage tracker, which includes unsmoothed lump sums, shows average negotiated wage growth of 4.8% in 2024, falling to 2.7% in 2025. The underlying bargained wage pressure measured by this indicator is the same as the pressure measured by headline wages. However, the size and frequency of one-time payments increases volatility. The wage trend excluding lump-sum payments is expected to be 4.2% in 2024, and gradually decline to 3.8% in 2025.
What do the four different metrics tell us?
The headline ECB wage tracker is a tracker of negotiated wage increases, including collectively agreed lump sum payments such as inflation compensation, bonuses or those related to past salaries, smoothed over 12 months will be done. Off payments reflect the extent of structural (or permanent) negotiated wage increases. The ECB’s wage tracker, which includes unsmoothed lump sums, is constructed using a conceptually similar methodology to that used by the ECB. The proportion of employees covered is the proportion of employees in participating countries directly covered by the ECB’s wage tracking data. This indicator provides information on the representativeness of the underlying (negotiated) wage growth signal from a set of wage tracking indicators across participating countries. Table 1
ECB Wage Tracker: Overview details.
(The ECB’s wage tracking indicator reflects the annual growth rate of bargained wages as a percentage; coverage is defined as a percentage of employees in participating countries)
ECB wage tracking tool
coverage
headline indicator
Excludes lump sum payment
in an unsmoothed state
one-time payment
percentage of employees
(in %)
2013-2023
2.0
1.9
2.0
47.4
2024
4.7
4.2
4.8
47.4
2025
3.2
3.8
2.7
32.0
Q1 2024
4.1
3.8
5.1
47.6
Q2 2024
4.4
3.8
3.4
47.6
Q3 2024
5.1
4.4
6.5
47.6
October 24th
5.1
4.5
4.1
47.1
November 24th
5.4
4.8
4.6
46.9
December 24th
5.4
4.8
3.9
46.3
January 25th
5.0
4.4
3.1
40.3
February 25th
5.0
4.7
3.2
40.1
March 25th
4.8
4.7
1.7
37.3
2nd quarter 2025
4.5
4.5
4.2
33.5
Q3 2025
2.2
3.4
1.5
28.9
Q4 2025
1.4
2.9
2.7
26.4
Source: ECB calculations based on data provided by Deutsche Bundesbank, Bank of Greece, Bank of Spain, Banque de France, Bank of Italy, Dutch National Bank, Dutch Employers Association AWVN and Eurostat.
Note: See technical details at the end of this press release. Darkly shaded rows with italic values indicate the future outlook for the respective indicator.
The coverage indicator indicates the average representativeness of the wage signal resulting from the wage tracker at the euro area level, proxied by the aggregate of participating countries. Employee coverage varies across countries and over time within countries (see Table 2 for details). Table 2.
Percentage of employees by country (% of employees in each country)
Germany
Greece
Spain
France
Italy
Netherlands
Austria
euro area
2013-2023
42.0
10.0
52.5
51.6
48.7
57.9
58.0
47.4
Q1 2024
44.1
14.9
48.6
47.7
48.3
59.9
78.0
47.6
Q2 2024
44.4
14.8
48.3
47.7
48.1
60.8
76.1
47.6
Q3 2024
44.6
14.7
48.7
47.6
47.9
59.3
76.0
47.6
Q4 2024
43.8
15.5
48.7
47.7
46.1
55.5
74.8
46.8
Q1 2025
40.3
13.5
28.4
46.0
38.5
52.7
31.2
39.2
2nd quarter 2025
36.2
9.4
27.7
36.1
30.3
47.5
23.5
33.5
Q3 2025
34.3
1.5
27.5
28.2
22.8
37.2
21.5
28.9
Q4 2025
32.3
1.1
27.4
23.6
22.3
28.2
17.8
26.4
Sources: ECB, Deutsche Bundesbank, Bank of Greece, Bank of Spain, Bank of Italy, Bank of France, Dutch employers’ association AWVN, Osterreichsche Nationalbank, Eurostat. Note: The euro area total is made up of the seven countries participating in wage tracking. This coverage indicates the relative strength of wage signals across countries or the euro area. Historical averages are calculated for Austria from February 2020 to December 2023 and for Greece from January 2016 to December 2023. For other countries, from January 2013 to December 2023. Darkly shaded rows with values in italics indicate future outlook. Components of each indicator.
All four indicators are published regularly at 10am on Wednesdays during the week following the ECB’s monetary policy meeting.
For media inquiries, please contact Eszter Miltényi-Torstensson at +49 171 7695305.
Note: For more information on the ECB Wage Tracker indicator, please see the ECB Blog. Further information can also be found in the ECB extraordinary document entitled “Future forecast tracker for negotiated wages in the euro area”. The ECB wage tracker has the following results: The Eurosystem partnership currently consists of the European Central Bank and the seven national central banks of the euro area: Deutsche Bundesbank, Bank of Greece, Bank of Spain, Bank of France, Bank of Italy, Deutsche Bank Nederlandsche Bank, and Osterreich National Bank. It is based on a highly detailed database of active collective bargaining agreements in Germany, Greece, Spain, France, Italy, the Netherlands and Austria. Wage trackers should be considered just one of many sources of information that can help assess wage pressures in the euro area. These are not the same as wage growth forecasts, as they only represent wage pressures arising mechanically from collective agreements already in place. The Eurosystem and ECB staff macroeconomic forecasts remain the most comprehensive assessment of the euro area wage outlook. The wage tracking method uses a double aggregation approach. First, we aggregate highly detailed information on collective bargaining agreements and use information on employee coverage rates in each country to construct a country-level wage tracking index. Second, we use this information to create a euro area aggregate with time-varying weightings based on the total compensation of employees in participating countries.
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