Explanatory Memorandum to COM(2001)418 - Labour cost index - Main contents
Please note
This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2001)418 - Labour cost index. |
|---|---|
| source | COM(2001)418  |
| date | 23-07-2001 |
For years the lack of a timely and comparable indicator on short term labour cost trends has been considered as a main weakness in labour market statistics. After many investments in a Labour Price Index during the nineties, the Statistical Programme Committee (SPC) decided in 1997 to consider the Labour Price Index as a possible long term solution and to implement a Labour Cost Index (LCI) as an intermediate solution, though without a legal basis.
The LCI produced and regularly disseminated since then is far from being satisfactory in terms of timeliness, coverage and comparability.
That is why the Action Plan on Economic and Monetary Union (EMU) statistical requirements (endorsed by the ECOFIN Council on 29 September 2000) included short term labour cost statistics in the package of draft Regulations to be presented to the European Parliament and Council in Spring 2001.
Policy context
In a zone as large as the EMU, labour costs are generally considered as the main potential source of inflation. A timely labour cost index is thus of utmost importance for the European Central Bank, to monitor inflation in the EMU, and for social partners to use in negotiating wage agreements.
The proposed Regulation will require Member States to provide quarterly data from employers on labour costs, using existing data where possible. The discussions with Member States, both at Working Group level and at the SPC have led to a simplification of the amount of detail that is required; for example, no breakdown by occupation or full-time/part-time will be necessary. The proposed Regulation has been drafted to be consistent with existing legislation on labour costs, earnings and national accounts.
The methodology to be used for the index and data transmission formats will be defined in detail in the Commission Regulation, together with the criteria for assessing the quality of the LCI from each Member State.
Next steps
As required by the Action Plan on EMU statistical requirements, the present proposal is part of a package of legal texts to be presented to the European Parliament and Council in spring 2001.