Cyprus recorded one of the lowest increases in hourly wage costs in the European Union during the fourth quarter of 2025, according to a report released by Eurostat on Thursday.

The figures showed that hourly labour costs rose by 3.3 per cent in the euro area and 3.7 per cent in the EU compared with the same quarter of the previous year.

Across the EU, Cyprus recorded a wage cost increase of 2.7 per cent, placing it among the lowest-performing member states alongside Germany.

Only a handful of countries posted weaker growth, with France at 1.1 per cent, Italy at 2.3 per cent, Denmark at 2.5 per cent and Finland at 2.6 per cent, while Malta recorded a decline of 3.9 per cent.

At the other end of the spectrum, Slovenia recorded the highest increase at 19.1 per cent, followed by Bulgaria at 13.8 per cent and Croatia at 10.5 per cent.

The data highlighted that labour costs are made up of wages and salaries as well as non-wage components, both of which contributed to the overall increase.

In the euro area, wages and salaries rose by 3.0 per cent, while the non-wage component increased by 4.4 per cent.

Across the EU, wages and salaries increased by 3.4 per cent, while non-wage costs rose by 4.5 per cent.

The report also showed that labour costs increased across all major sectors of the economy.

In the euro area, hourly labour costs rose by 3.5 per cent in the non-business economy and by 3.2 per cent in the business economy.

Sectoral data showed increases of 2.5 per cent in industry, 4.0 per cent in construction, and 3.4 per cent in services.

Across the EU, labour costs increased by 3.7 per cent in both the business and non-business economy.

Within the EU, sectoral growth reached 3.1 per cent in industry, 4.5 per cent in construction, and 3.9 per cent in services.

The strongest increases in hourly wage costs were recorded in real estate activities at 4.6 per cent, followed by professional, scientific and technical activities at 4.5 per cent and education at 4.4 per cent.

Eurostat also reported that construction and transport and storage both recorded increases of 4.1 per cent.

The lowest annual increase was seen in electricity, gas, steam and air conditioning supply at 2.7 per cent, followed by manufacturing at 2.8 per cent, while mining and quarrying recorded a decline of 1.2 per cent.

In terms of non-wage costs, the highest increases were recorded in construction and real estate activities at 5.8 per cent, followed by transport and storage, professional services and other service activities at 5.4 per cent.

The lowest increase in non-wage costs was recorded in electricity and energy supply at 3.0 per cent, while mining and quarrying remained unchanged.

The figures underline that while labour costs continue to rise across Europe, Cyprus is experiencing more moderate wage growth compared to most EU member states.