UK unit labour costs rise by two per cent - competitiveness is lagging behind Europe and the US

The whole economy Index of Labour Costs per Hour (cost of labour) from the ONS increased by 2.0 per cent in the first quarter of 2013 compared with the same quarter of 2012. This amounted to a 2.1 per cent increase in public sector labour costs per hour and a 1.7 per cent rise in the private sector.

Wage costs per hour worked decreased by 1.6 per cent, although non-wage costs per hour worked increased by 4.3 per cent in the first quarter of the year.

The industry with the greatest growth in costs in the first quarter was textiles, leather and clothing, while mining and quarrying decreased by the most.

Rising labour costs decreases the competitiveness of UK businesses. Although the two per cent rise works out as a reduction in real-terms, the UK is still lagging behind the competition - check out this chart trending on Twitter this morning:

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