Largely driven by falls in real output (gross domestic product at constant prices) due to the crisis, unit labour costs for the total economy rose 0.9% for the OECD area in the fourth quarter of 2008 and were up 2.9% year on year. The group of the major seven economies and the Euro area display similar aggregate trends.

Unit labour costs rose 1.0% in the market services sector for the OECD area in the fourth quarter of 2008 and 2.7% on an annual basis. Among the major seven economies, unit labour cost growth rates in market services only increased in the United States (1.3%) and Japan (0.8%) in the fourth quarter.

In industry, unit labour costs for the OECD area continued to grow at a stable rate of 1.2% in the fourth quarter of 2008; 3.9% year on year. Among the major seven economies, Italy had the highest growth rate in industry with 2.2% in the fourth quarter, accumulating to 7.3% on an annual basis. Growth in Japanese industry unit labour costs slowed to 0.4% in the fourth quarter of 2008 from the 0.5% growth recorded in the previous quarter. Unit labour costs in German industry increased 0.3% in the fourth quarter of 2008 compared with 0.6% in the third quarter.