Cyprus Labour Costs Set At €21.7 In 2025 As EU Averages Reach €34.9

Overview Of Eurostat’s Findings

Eurostat data show that average hourly labour costs in Cyprus are projected to reach €21.7 in 2025. Non-wage costs, including social contributions, account for 19.4% of total labour expenses, reflecting the structure of employment costs in the country.

Regional And Sectoral Comparisons

Across the European Union, average hourly labour costs are expected to increase from €33.5 in 2024 to €34.9 in 2025, while in the euro area they are projected to rise from €36.8 to €38.2. Eurostat data indicate annual increases of 4.1% across the EU and 3.8% in the euro area, pointing to continued upward pressure on labour costs.

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Country-Level Divergence

Most euro area countries recorded increases, although Malta reported a decline of 0.5%. Higher growth rates were observed in Bulgaria (13.1%), Croatia (11.6%), Slovenia (9.3%), and Lithuania (9.2%), while more moderate increases were recorded in France (2.0%) and Italy (3.2%). Cyprus, Spain, and Luxembourg each reported a 3.5% increase.

Disparities And Implications Across The EU

Significant differences remain across member states in absolute labour cost levels. Lower hourly costs were recorded in Bulgaria (€12.0), Romania (€13.6), and Hungary (€15.2), while higher levels were observed in Luxembourg (€56.8), Denmark (€51.7), and Netherlands (€47.9).

Non-wage costs accounted for 24.8% of total labour costs in the EU and 25.6% in the euro area. Lower shares were recorded in Romania (4.8%), Lithuania (5.5%), and Malta (5.8%), whereas higher shares were observed in France (32.3%), Sweden (31.7%), and Slovakia (28.6%).

Broader Employment Cost Trends Outside The Eurozone

Labour costs also increased in EU countries outside the euro area when measured in national currencies. Higher growth rates were recorded in Romania (10.6%), Hungary (8.9%), and Poland (8.8%), while Denmark reported a more moderate increase of 3.0%.

Conclusion

Eurostat data point to continued growth in labour costs across Cyprus and the European Union, alongside notable differences between countries. These trends may influence wage developments, labour market conditions, and business costs across the region.

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Lithuania And Cyprus Forge Enhanced Partnership In Tourism And Defence

by THEFUTURE.TEAM

May 22, 2026

Expanding Cooperation Beyond The Surface

Kristupas Vaitiekūnas highlighted opportunities for closer cooperation between Lithuania and Cyprus during his visit to Nicosia for the informal ECOFIN meeting. Speaking to the Cyprus News Agency, the Lithuanian finance minister said both countries share common challenges and could expand collaboration in areas including tourism, defence and financial services.

Addressing Shared Challenges

Finance Minister Kristupas Vaitiekūnas said Lithuania and Cyprus face similar security and economic pressures despite their geographic differences. Particular attention was given to emerging security threats, including drone-related risks, alongside the importance of maintaining resilient financial sectors. According to Vaitiekūnas, stronger coordination in those areas could deliver long-term economic and strategic benefits for both countries.

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Focus On Fiscal Stability And Energy Security

Discussions at the ECOFIN meeting are expected to focus on Europe’s economic outlook, energy market volatility and fiscal stability. Kristupas Vaitiekūnas warned that instability in the Middle East could continue affecting oil markets and broader economic performance across Europe. Housing affordability was also identified as a growing challenge, with rising property prices in cities such as Vilnius reflecting broader pressures seen across European markets.

Coordinated Energy Strategy And Future Investments

The Lithuanian finance minister also called for a more coordinated European approach to energy and economic resilience. Vaitiekūnas suggested that targeted and temporary policy measures could prove more effective than large-scale structural reforms in addressing short-term pressures. Lithuania continues to increase investment in renewable energy generation and storage infrastructure as part of efforts to strengthen energy independence and begin producing surplus electricity by 2028.

Support For Ukraine And Enhancing Defence Funding

Finance Minister Kristupas Vaitiekūnas reaffirmed Lithuania’s support for Ukraine, describing the war as a broader struggle tied to European security and democratic values. He also backed accelerating Ukraine’s accession process to the European Union, arguing that deeper integration would strengthen regional stability and economic prosperity. Vaitiekūnas welcomed the EU’s SAFE programme, which is expected to support Lithuania’s defence capabilities while contributing additional assistance to Ukraine.

Looking Ahead To A More Unified Europe

Addressing the European Union’s future budget framework, Kristupas Vaitiekūnas said increased funding for security and defence represented a positive development. At the same time, he warned that reductions in cohesion funding and agricultural support could negatively affect purchasing power and long-term European unity. Lithuania is expected to place continued emphasis on Ukraine and regional security ahead of its upcoming EU Council Presidency in early 2027.

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