Malta’s hourly labour costs rose by a crippling 3.7 per cent during the third quarter of the year, much higher than the 2.7 per cent average in the euro area.

While it may be good news for employees, it reduces the country’s competitiveness compared to other EU states.

According to Eurostat, which issued the figures, the biggest increase in Malta’s hourly labour costs in the third quarter, compared to the same period last year, was in salaries and wages – up 3.7 per cent. Other increases, including employers’ social contributions, amounted to 3.1 per cent.

Among the member states for which data are available, the highest annual increases in hourly labour costs were registered in Bulgaria (+9.8 per cent), Romania (+7.9 per cent) and Slovakia (+7.2 per cent), and the smallest increases in Portugal (+0.8 per cent) and Cyprus (+1.4 per cent). A decrease was recorded in Ireland (-1.1 per cent).

There was good news, on the other hand, in exports. By September, the figure reached €2 billion, a rise of more than 46 per cent over the same period of 2010 and the second highest growth in exports in the EU.

According to the EU’s statistics arm, only Estonia has so far managed to outperform Malta’s exports success.

On the other hand, imports also went up although at a slower pace than exports. Between January and September 2011, Malta imported €2.8 billion worth of goods, an increase of 19 per cent over the same period in 2010.