Labour Cost Survey

Statistical Office of the Republic of Serbia

Department of Employment and Earnings statistics

Cmilja Ivkovic

Head of Department

Belgrade, 5 Milana Rakića St.

cmilja.ivkovic@stat.gov.rs

+381 11 2412 922 ext. 270

+381 11 2412 350

The aim of this Survey is to provide data on the amount and structure of labour costs borne by employers on the basis of labour force engagement. The results of the survey provide employers and economic policy makers with an insight into the state and structure of labour costs in the domestic labour market and their comparison with the international labour market, and also show the impact of legal regulations on the amount and structure of labour costs.

The survey collects data on the:

• number of full-time and part-time employees;
• number of hours actually worked;
• number of paid hours;
• labour costs.

The following classifications have been used in this survey:

• Classification of Activities (2010) - CA (2010), based on the Law on the Classification of Activities (“Official Gazette of the RS”, number 104/09), prescribed by the Government by the regulation of 29 July 2009 (“Official Gazette of the RS”, number 54/10). This classification is comparable with the EU classification of activities (NACE, rev. 2);
• Nomenclature of Statistical Territorial Units - NSTJ,  based on the Regulation of the Nomenclature of Statistical Territorial Units (“Official Gazette of the RS”, number 109/09 and 46/10).This classification is comparable with the Nomenclature of Territorial Units for Statistics (NUTS). 

The data are representative and are processed on the level of CA (2010) sections and divisions; for the territory of the Republic of Serbia and statistical territorial units of Srbija – sever and Srbija – jug (NSTJ 1); and size classes of enterprises by the number of employees (10-49, 50-249, 500-999 and 1000 and more employees).

The Labour Cost Survey in the Republic of Serbia covers all sections of activities of the Classification of Activities (CA 2010) in which enterprises can be registered, (А-S).

Eurostat regulations stipulate that this survey does not cover section A – Agriculture, forestry and fishing.

In order to have data comparable with those of other European countries, separately are presented aggregated data that cover all the sections of activities and aggregated data without section A – Agriculture, forestry and fishing.

Five size categories are distinguished: 10-49, 50-249, 250-499, 500-999 and 1000 and more employees.

Labour costs refer to the total expenditure borne by employers for the purpose of employing staff. They include employee compensation, which is mainly comprised of gross wages and salaries in cash and in kind and employers' social security contributions, vocational training costs, other expenditure, such as recruitment costs and spending on working clothes, and employment taxes regarded as labour costs minus subsidies received.

A.1. Total number of employees are persons  in employment who have an employment contract with an employer for a fixed or indefinite time, whether working full time or part time, as well as persons who work under a contract of temporary jobs (interim or temporary workers, seasonal and occasional workers), and who received earnings.

A.11. Full-time employees are persons  in employment who work full time and more than full time. If the law, collective agreement or employment contract does not specify working hours, it is considered that full-time work consists of 40 hours per week.

A.12. Part-time employees are persons in employment whose working hours are less than full time.

B.1.   Total number of hours worked cover hours actually worked (effective hours of work), hours when employees have been at their place of work but have not worked for some reasons (machine breakdowns and setting-up, tool preparation and maintenance, current lack of work, short rest periods at the place of work etc.), during which time they have received their wages; time spent on training, training courses or seminars in the workplace or at another institution, regardless of whether employees are paid additionally or not  for training; and overtime hours (regardless of whether they are paid or not).

Excluded are hours paid but not worked such as personal days, annual leave, national and religious holidays, sick leave up to 30 days, paid absence up to 7 days, a break during the work (30 minutes and more – main meal break, as well as hours not worked but paid by funds and other legal entities (sick leave longer than 30 days, maternity leave and other reimbursed hours of work).

B.11.   Hours actually worked by full-time employees includes actually worked hours - effective hours of work of full time employees

B.12.    Hours actually worked by part-time employees include actually worked hours - effective hours of work of part time employees.

C.1.   Total hours paid includes hours actually worked and paid (during normal working hours and overtime) and hours not worked but nevertheless paid (annual leave, national and religious holidays, sick leave up to 30 days).

Exclude: hours  not worked  but paid by funds and other legal entities (sick leave longer than 30 days, maternity leave and other reimbursed hours of work). 

C.11.    Paid hours by full-time employees include paid hours of full-time employees.

C.12.   Paid hours by part-time employees includes paid hours of part-time  employees  .

D Labour costs mean the total expenditure borne by employers in order to employ staff. Labour costs include compensation of employees (D.1) with wages and salaries in cash or in kind and employers' social contributions, vocational-training costs (D.2), other expenditures (D.3),less any subsidies received (D.5). The costs for persons employed by temporary employment agencies are to be included in the industry of the agency which employs them (NACE Rev.2.  78.20 and 78.30) and not in the industry of the enterprise for which they actually work.

D.1 Compensation of employees is defined as the total remuneration, in cash or in kind, payable by an employer to an employee in return for work done during the reference period. Compensation of employees include wages and salaries (D.11), and employers' social contributions (D.12). 

D.11 Wages and salaries include direct remuneration, bonuses and allowances (D.1111), payments for days not worked (D.11113) and wages and salaries in kind (D.11114).

D.1111 Direct remuneration, bonuses and allowances include direct remuneration, bonuses and allowances paid in each pay period (D.11111) and  direct remuneration, bonuses and allowances not paid in each pay period (D.11112).

D.11111 Direct remuneration, bonuses and allowances paid in each pay period. This means remuneration in the form of regular cash payments paid regularly at each pay period during the year, which is in most cases monthly. This variable include : basic wages and salaries, direct remuneration calculated on the basis of time worked (length-of –service), remuneration and additional payments for shift work, duty or on-call payments, night work, overtime,  working on Sundays and public holidays, workplace bonuses for noise, risk, difficult work, shift or continuous work, individual performance bonuses, bonuses for output, production, productivity, responsibility, diligence, punctuality; payments covering journeys between home and usual working place if they are cash transactions paid in each pay period, cost-of-living allowance. Variable D.11111 refers to gross amounts before deduction of taxes and social-security contributions payable by employees.

D.11112 Direct remuneration, bonuses and allowances not paid in each pay period. All payments to employees which are not paid regularly at each pay period. This variable include: productivity bonuses/awards for meeting performance targets - bonuses and allowances paid at fixed periods (13th or 14th month pay), special festive bonus, golden handshake and employee recognition awards.  Variable D.11112 likewise refers to gross amounts before deduction of taxes and social-security contributions payable by employees.

D.1113  Payments for days not worked include  remuneration paid for statutory, contractual or voluntarily granted leave and public holidays or other paid days but not worked (payments to employees for absence from work in periods of national and religious holidays, annual leave, paid absence, work stoppage not caused by the employee and payments for other cases when the employer deems it fit in line with the general act).

D.1114  Wages and salaries in kind. This variable refers to an estimate of the value of all goods and services made available to employees. It includes costs such as company cars costs for the utilization of corporate car for employees’ needs for non-corporate purposes (the cost of leasing, depreciation, insurance, maintenance, repair, parking, garaging, fuel, etc.) and payments covering journeys between home and usual working place if the cost are directly charged to the employer; free or subsidized housing (maintenance and administration costs, the costs of taxes and insurance associated with such accommodation and costs for the construction or purchase of properties by employees or the difference between market interest rates and certain ones that are really specific staff); employee benefits in kind/ company products (net costs of enterprises for products that have been granted to employees, or the difference between the purchase price and the price at which the products were sold to employees as well as commodity certificates), stock options and share purchase, as well as other payments in kind (costs for repairs, maintenance and depreciation of premises for the provision of services in the field of culture, sports and other leisure activities related to employees, the costs of caring for the children of employees; gifts for children of employees; gifts on March 8 and other holidays, the costs of mobile telephony costs resorts, payment of employers in union funds, scholarships according to the contract of schooling, etc.).

D.12   Employers' social contributions include employers' actual social contributions (D.121) and employers’ imputed social contributions(D.122).

D.121  Employers' actual social contributions include statutory social-security contributions paid to social-security institutions by the employer and made compulsory by law; and collectively agreed, contractual and voluntary social-security contributions paid to social-security institutions by the employer which are supplementary to those which are compulsory by law.

D.122  Employers’ imputed social contributions include wage compensation for the period of absence from work due to temporary inability to work up to 30 days, the additional costs for health care, severance age pension and severance pay to employees who have been made redundant, and other social benefits such as disposable compensation of employees in accordance with the social program, employee and family assistance (assistance in the event of death of the employee, in case of death of an employee's immediate family, welfare assistance in case of serious or prolonged illness of an employee or a member of his immediate family, welfare assistance for the purchase of medicines and the treatment of the employee or a member of his immediate family, other types of assistance to employees and their families).

D.2 Vocational training costs include: expenditure on participation in courses seminars, symposiums, professional trips, etc. Also expenses for teaching aids and tools used for training.

D.3 Other expenditure paid by the employer include the  employer's costs related to the recruitment of new workers (on ads, for employment agencies, the costs of interviews with candidates, etc.) and costs of occupational health services relating to the purchase of protective and work clothes.

D.4 Other taxes include the costs of an employer in connection with the performance of the obligation to employ persons with disabilities, i.e. payment of penalties due to the unemployment  of the legally prescribed number of persons with disabilities. These costs include the obligations arising from Articles 26 and 27 of the Law on Vocational Rehabilitation and Employment of Persons with Disabilities ("Official Gazette of the Republic of Serbia", No. 36/2009  32/2013 and 14/2022). Excludes: costs for employees that employers have if they have employed the required number of employees with disabilities, treated as regular labour costs).

D.5 Subsidies received by the employer include all kinds of subsidies from the state or other enterprises, companies or organizations in the country or abroad for the purpose of subsidizing a part of total labour costs or total labour costs. Subsidies reduce labour costs. Excluded are subsidies covering contributions and payments for social security / protection, education costs and funds reimbursed by the Republic Fund for Pension and disability Insurance and the Republic Fund for Health Insurance.

Note:Methodological solutions that are fully harmonised with European recommendations (European Statistical Office) are used in this survey, thus making data of the Republic of Serbia comparable with other countries. Used are the definitions and recommendations published in the following regulations: Council Regulation (EC) No 530/1999 of 9 March 1999; Commission Regulation (EC) No 1726/1999 of 27 July 1999. Commission Regulation (EC) No 1737/2005 of 21 October 2005).

The names and definitions of  Labour Cost Survey variables are determined by theCommission Regulation (EC) No.1737 / 2005of 21 October 2005. The names of specific variables in the Serbian language does not represent a direct translation from the English language, they are formulated to correspond to the contents of variables, and to comply with terms used in the national legislation and accounting system.

The reporting units are all active enterprises (legal entities and entrepreneurs) on the territory of the Republic of Serbia that have on average 10 or more employees in the reference year, and are selected by random sampling. The reporting unit transmitted data for the whole enterprise, i.e. in aggregate form for all the organisational parts (local units).

Observation unit is reduced to the level of the local kind of activity, using the appropriate statistical methods.

Based on the data on the number of employees from the SPR, the structures (coefficients) were calculated, which were used to allocate the total labor costs, the number of employees and working hours according to the place of work and field of activity.

Data processing provided data for the following territorial levels: Srbija – sever and Srbija – jug, as well as for CA (2010) divisions. The collected data for enterprises having parts on both mentioned territories or in more activity divisions are broken-down. 

All active business entities (legal entities and entrepreneurs) in the territory of the Republic of Serbia, which have on average 10 or more employees in the reference year, and are registered in the sections of activity A to S (CA 2010).

Republic of Serbia.

Since 1999, the Statistical Office of the Republic of Serbia has no available data for AP Kosovo and Metohia, therefore they are not included in the data for the Republic of Serbia (total).

Year 2012, 2016 and 2020.

Not applicable.

Labour costs and components of labour costs are expressed in RSD. Labour Costs are shown in thousands or millions, average labour costs are calculated as annual and monthly average per employee (expressed in full-time equivalents), average per hour actually worked; structure of labour costs is expressed in percentages. Other variables are expressed in absolute numbers (number of employees, number of hours actually worked, number of hours paid).

Calendar year.

The Labour Cost Survey is carried out pursuant to the Law on Official Statistics (“Official Gazette of RS”, number 104/09, 24/11) and valid Regulation on Establishing Certain Statistical Surveys and the Programme of Official Statistics of the Republic of Serbia concerning the period when the survey is conducted.

Harmonisation with international recommendations, standards and practice

Methodological solutions that are fully harmonised with European recommendations (European Statistical Office) are used in this survey, thus making data of the Republic of Serbia comparable with other countries. Used are the definitions and recommendations published in the following regulations: Council Regulation (EC) No. 530/1999 of 9 March 1999; Commission Regulation (/ec) No 1726/1999 of 27 July 1999, Commission Regulation (EC) No. 1737/2005 of 21 October 2005).

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National legislation:

National confidentiality policy is defined in Official statistics law http://www.stat.gov.rs/media/2322/zakon_o_statisticie.pdf

Regulation (EC) No 223/2009 of the European Parliament and of the Council, of 11 March 2009, on the transmission of data subject to statistical confidentiality to the Statistical Office of the European Communities https://eur-lex.europa.eu/legal-content/AUTO/?uri=CELEX:32009R0223&qid=1531209478738&rid=1

Confidential data are treated according to the confidentiality related policy rules.

http://www.stat.gov.rs/media/2322/zakon_o_statisticie.pdf

Calendar of press releases and calendar of publications are published at the end of the year for the next year.

http://www.stat.gov.rs/en-us/calendar/

In line with the Official Statistics Law (Official Gazette of the RS, No. 104/2009, 24/2011) and European Statistics Code of Practice, all users are treated equitably. Data are published on the SORS website, in form of releases and in the dissemination database, after which those data are simultaneously accessible to all users. Every deviation from the plan published in the Publications Calendar shall be previously announced and explained. 

Four-year frequency.

Not available.

- Release ZP30 - Labour Costs in the Republic of Serbia, 2020. https://publikacije.stat.gov.rs/G2022/PdfE/G20221205.pdf

The data are available in the SORS Dissemination database, see Labour market / Labour costs http://data.stat.gov.rs/?caller=SDDB&languageCode=en-US

Data can be found on Eurostat's database http://ec.europa.eu/eurostat/web/labour-market/labour-costs/database.

Micro data are accessible at user’s demand in accordance with principles defined in Official Statistic Law http://www.stat.gov.rs/media/2322/zakon_o_statisticie.pdf   and rules defined by “Rulebook on the method of using and providing the data produced by the Statistical office of the Republic of Serbia” http://www.stat.gov.rs/media/2344/rulebook-on-the-method-of-using-and-providing-the-data-produced-bythe-sors.doc

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http://www.stat.gov.rs/en-us/o-nama/sistem-upravljanja-kvalitetom/

Before publishing the results, extensive data quality control is carried out. Compliance with other statistical domains is satisfactory. Comparability over time is good. The release of the results is in accordance with the publication calendar and the data is readily available to all users.

The main beneficiaries of data obtained by the Labour Cost Survey can be recognized are the Ministry of Labour and Social Affairs, the Ministry of Finance, the Ministry of Economy, the Chamber of Commerce and Industry, Trade unions and Unions of Employers, then the Chamber of of Commerce and foreign employers (investors), also Eurostat to which the data are regularly transmitted, the European Central Bank, the International Monetary Fund and the International Labour Organization.

User satisfaction is measured on the basis of the amount of downloaded data and by Users Satisfaction Survey. The results of the last survey are available https://www.stat.gov.rs/media/345277/izvestaj-rezultati-istrazivanja-o-zadovoljstvu-korisnika-2021-eng.pdf

Methodological solutions that are fully harmonised with European recommendations (European Statistical Office) are used in this survey, thus making data of the Republic of Serbia comparable with other countries. Used are the definitions and recommendations published in the following regulations: Council Regulation (EC) No. 530/1999 of 9 March 1999; Commission Regulation (EC) No 1726/1999 of 27 July 1999, Commission Regulation (EC) No. 1737/2005 of 21 October 2005).The names and definitions of  Labour Cost Survey variables are determined by Commission Regulation (EC) No.1737 / 2005of 21 October 2005.

SORS collected and provided all mandatory variables except the variables related to the apprentices, variable D1112.

Missing mandatory variables from LCS 2012:

• А13 – Apprentices,
• A131 – Apprentices converted into full-time units,
• B13 – Hours actually worked by apprentices,
• C13 – Paid hours for apprentices,
• D112 – Wages and salaries of apprentices,
• D123 – Employers’ social contribution for apprentices,
• D1112 – Payments to employees’ saving schemes.

The Labour Cost Survey in the Republic of Serbia covers all sections of activities of the Classification of Activities (CA 2010) in which enterprises can be registered. Eurostat regulations stipulate that this survey does not cover section A – Agriculture, forestry and fishing. In order to have data comparable with those of other European countries, presented are aggregated data that cover all the sections of activities and aggregated data without section A – Agriculture, forestry and fishing.

Sampling frame for 2020 was constructed using Statistical Business Register (state March 2021). The sampling frame consisted of enterprises from SBR with the following characteristics:

• Their main activity belonged to the sections A - S of NACE Rev. 2 classification of economic activities;
• They had 10 and more employees;
• Corresponding legal entities were not closed or in liquidation process according to data from SBR, the source for this data is Business Register Agency (BRA).

The frame consisted of 19848 enterprises (sampling units), both from public sector and from non-public sector.

Stratification of frame: units were grouped into size classes according to the number of employees, NACE Rev. 2 divisions and NUTS level 1.

According to the number of employees enterprises were classified into five size classes:

• 10-49 employees,
• 50-249 employees,
• 250-499 employees,
• 500-999 employees,
• 1000 and more employees.

According to NACE Rev. 2 divisions enterprises were stratified into 84 classes (01–03, 05–33, 35–38, 41–43, 45–47, 49–53, 55–56, 58-66, 68–75, 77–82, 84-88, 90–96).

According to NUTS level 1, enterprises were stratified into Serbia - North (RS1) and Serbia - South (RS2).

Final stratification is defined by cross classifying size classes, divisions and two territory classes. Strata with 250 and more enterprises were census strata, they were enumerated completely. Census strata were also strata with only one unit.

In all, there were 537 strata, 246 census and 291 non-census strata.

Sample allocation was obtained as a solution of a non-linear optimization problem under multiple constraints according to the adopted multivariate and multi-domain procedure (Bethel, 1989, ISTAT) [1]. Sample was allocated taking into account that expected sampling errors in terms of coefficient of variations (CV) for estimates of totals of auxiliary variables (in this case it was only average number of employees for the previous 12 months according the CROSO database) in every domain of interest should be less or equal than already fixed planned errors.

Allocated sample consisted of 3807 enterprises. There were 879 census units (enterprises with 250 and more employees and enterprises from strata with only one unit).

Sequential simple random sample was selected using permanent random numbers with Uniform distribution on the interval (0, 1). The starting point for sample selection was 0.75.

The estimates of totals and standard errors (Horvitz-Thompson estimates) were calculated in the standard way for stratified simple random sample. The sampling weights were adjusted for non-response. There were no strata without responding units. Strata with one responding unit, but with more than one unit in the planned sample, were not collapsed with similar strata, because they were from different territory classes (Serbia-North and Serbia-South).

Outliers were detected according to annual costs on the level of NACE Rev. 2 divisions. They were classified into one census stratum and the weights of the remaining units in the strata from which they were excluded were corrected. 

Prior to weighting, the values of labour cost variables of enterprises with parts, with respect to NACE Rev. 2 divisions or to two NSTJ 1 territory classes, were broken down on parts (as described in section  Statistical units).

In the annex "Planned domains for the final estimates of the results" are shown the maximum planned errors, i.e. coefficients of variations (CV) for sample allocation by domains.

In annex "Coefficient of variation", estimates of the key variables Annual labour costs and Hourly labour costs are presented, as well as their standard errors and coefficients of variations. These estimates are presented on the total level of Serbia, on the level of territory; NACE Rev. 2 sections and on the level of size classes.

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[1] Bathel, J. Sample allocation in multivariate surveys. Survey methodology 15 (1989): 47-57.

06.3. Non-sampling error

Coverage errors most often occur as a consequence of the sampling frame imperfections. If the frame misses some of the scope units there is an under-coverage error. On the other hand, if the frame includes some out of scope units there is an over-coverage error. Over-coverage measures were calculated on the level of an enterprise.

Non-response errors

For in-scope units, the response rate is the ratio of the number of respondents to the total number of in-scope units. In scope units include the respondents and non-respondents.

The overall response rate is 92.3%. The highest response rate is 100% in section D- Electricity, gas, steam and air conditioning supply and the lowest response rate is 81.6% in the section N - Administrative and support service activities.

In the case of item non-response, imputation of missing values, from other appropriate available sources or using deductive principles - estimation of the missing value based on the logical relations of other known variables, was made.

The data are published in accordance with the release calendar.

Тhe data are submitted to Eurostat within the prescribed period, 18 months after the reference period.

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There are no differences between national and European concepts regarding the population, reference time and classification. Although, the unit of sample selection was the enterprise, usage of appropriate statistical method of estimation had resulted in that observation unit was actually the L- KAU. Concerning the definitions of variables, there are no deviations from the European concepts.

There were no significant changes in methodology and definitions in 2020 compared to 2016 and 2012, except that data on other taxes (D4) - Taxes, employer costs related to fulfillment or non-fulfillment  of the obligation of employing people with disabilities, were not collected in  2012.

The degree of coherence is satisfactory. The data are compared with:

- Structural Busines Btatistics (SBS)

- Labour Force Survey (LFS)

- The survey on earnings, as well as

- Labour Cost Index (LCI)

Differences in the data that occur are expected and are the result of different methodologies, coverage and definitions.

Data for variable D4 - Taxes, employer costs related to fulfillment оr non-fulfillment of the obligation of employing people with disabilities, were not collected in  2012.

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The main principles and standards of the revisions of released statistical data are defined by the General Revision Policy of the Statistical Office of the Republic of Serbia. http://www.stat.gov.rs/media/2332/general-revision-policy.docx

Not applicable.

The Labour Cost Survey 2020 is sample based survey.

The sampling frame is constructed using Statistical Business Register (state March 2021). It contains 23 720 units (active enterprises) with 10 or more employees, which main activity is from the section A-S of NACE Rev. 2 (2010) classification.

A stratified simple random sample of a size of 3807 units has been selected. The stratification was according to the size (five classes according to the number of employees), NACE Rev. 2 divisions and according to the territorial levels NSTJ 1.

The Horvitz-Thompson estimator of the totals and standard errors has been calculated by standard procedure for a stratified simple random sample. the final weights were adjusted for non-responses.

Four-year frequency.

The survey is based on reporting method by means of the questionnaire LCS, which is to be filled in by every enterprise in the sample. The questionnaire is to be filled in for the enterprise as a whole, i.e. as total for all organisational parts, whether located on the same or another address.

Reporting units are offered to choose whether to submit the information by post on a printed questionnaire or electronically via a web-questionnaire.

Integrated Survey Tool (IST) is used for logical control and corrections of errors. IST is a software package that enables the process of data entry, logical control and production of output tables. 

In order to ensure the quality of statistical data, the control is performed during the data entry itself. In applications (web applications and IST applications) for data entry, a logical control was incorporate, which would draw attention to possible errors and inconsistencies when entering data. The following steps in data validation include contingent control, and data analysis to identify potential errors, understand the logic and validity of data, as well as to identify extreme values. Checks are performed by automated procedures and expert data analysis Data are compared with data from the previous period and with available data from other sources.

The processing steps can be summarized as follows.

Not applicable.