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Early Estimates of Quarterly Unit Labour Cost (ULC) indicators for the total economy provide current edge data on ULCs and their components labour productivity and labour compensation per employed person.
Unit labour costs (ULCs) measure the average cost of labour per unit of output. They are calculated as the ratio of total labour costs to real output. Different from the estimates of annual ULC above, the Early Estimates of Quarterly ULC use employment and not hours worked as measure of labour input. Quarterly ULCs can be decomposed into the components labour compensation per employee and output per person employed (employment-based labour productivity).
The OECD estimates of total labour costs adjust for labour compensation of self-employed persons
Every effort has been made to ensure that data are comparable across countries. The adjustment for the self-employed assumes that labour compensation per person is equivalent for the self-employed and employees. This assumption may be more or less valid across different countries and economic activities. EEQ ULCs are also fully compatible with the ULC series published by the ECB which provides ULC series for 21 EU OECD member countries and Euro area. Those for nine Non-EU member OECD countries are compiled by the OECD following a methodology that is fully consistent with that used by the ECB.
It is widely recognised that hours worked are the appropriate measure of labour input for productivity analysis. For reasons of data availability, however, quarterly estimates of ULC and labour productivity are based on employed persons and not hours worked. The estimates are hence not strictly comparable to annual productivity and ULC estimates published in the OECD Productivity database.
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