the index of wage and salary earnings 2005=100

Handbooks 33c

The Index of Wage and Salary Earnings 2005=100Handbook for users

Helsinki 2010

Handbooks 33c

The Index of Wage and Salary Earnings 2005=100Handbook for users

Inquiries:

Harri Nummila(09) 17 341

e-mail: [email protected]

Homepage: http://www.tilastokeskus.fi /til/ati/index_en.htmlDescription of statistics: http://tilastokeskus.fi /til/ati/meta_en.html

Layout: Eeva-Liisa Repo

© 2009 Statistics Finland

Quoting is encouraged provided Statistics Finland is acknowledged as the source.

ISSN 1797–9439 = HandbooksISBN 978–952–244–209–3 (pdf)

ForewordStatistics Finland started publishing its new re-vised index of wage and salary earnings in Au-gust 2008. The index of regular earnings was up-dated in the same connection. Both these indicesshare the same base year of 2005.

This handbook follows the same structureand provides similar methods descriptions as theprevious handbook for the index of wage and

salary earnings that was compiled for the baseyear 1995. The focus here is to describe thoseareas and aspects of the indices and methodsthat have been updated.

The handbook update was prepared by HarriNummila, Antti Katainen and Mari Ylä-Jarkko.

Helsinki, Statistics Finland, April 2009

Kari MolnarDirector

Statistics Finland 3

4 Statistics Finland

ContentsForeword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

2 What do the index of wage and salary earnings and the index ofregular earnings measure? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.1 Index of wage and salary earnings includes performance

rewards and one-offs based on collective agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.2 Work duties partly standardised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.3 Focus on earnings for normal working hours . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

3 Index classifications and weight structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93.1 Employer sector and wage data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

3.1.1 Wage data · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·93.1.2 Weight structure by employer sector · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 10

3.2 Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103.2.1 Industrial classification · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·103.2.2 Production and publication of old indices by industry · · · · · · · · · · · · · · · · 123.2.3 Industry weights · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·12

3.3 Classification of wage and salary earners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133.4 Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

4 Calculation of indices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .154.1 Calculation of average earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .154.2 Calculation of indices from average earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .154.3 Calculation of the development of teachers’ earnings . . . . . . . . . . . . . . . . . . . . . . . . . 164.4 Preliminary information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

4.4.1 Estimating the development of regular earnings · · · · · · · · · · · · · · · · · · · · · 174.4.2 Adding one-offs to regular earnings· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·17

4.5 Intermediate quarters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .185 Old indices and other outputs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

5.1 Average earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195.2 Index of negotiated wages and salaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205.3 Real earnings index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

6 Uses and application of indices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .216.1 Indexation rules currently in force in Finland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

7 Calculation examples . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227.1 Calculating change in earnings level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227.2 Calculating change in earnings level by indices

with two different base years. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227.3 Changing index base year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227.4 Calculating own index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

8 Publication of the index of wage and salary earnings and the index of regular earnings . . . . . 24

1 IntroductionThe index of wage and salary earnings has beenused to measure and describe the developmentof wages and salaries in Finland since 1948. Itprovides a measure of wage and salary earners’nominal earnings exclusive of the impact of in-flation and taxation on their purchasing power.As well as describing the development of nomi-nal earnings, the wage and salary earnings indexcan be used to calculate the development ofwage earners’ real earnings by subtracting thechange in consumer prices from the change innominal earnings. From 1948 through to 2007,nominal earnings have increased on average by8.1 per cent a year, while real earnings have goneup by an annual average of 2.5 per cent. In thelatter half of the twentieth century nominalearnings increased every year, at best by as muchas 30 per cent. With the exception of a few peri-ods of deep recession, real earnings have

continually increased by up to over 10 per cent ayear.

The rise in nominal wages and salaries slowedin the wake of the recession in the early 1990s,and has remained slow ever since. From 1991 to2007, the average annual increase in nominalearnings slowed to 3.2 per cent, with the in-crease in real earnings down to just 1.6 per cent.However, if the recession years are excluded, thefigures are somewhat higher at 3.6 per cent and2.1 per cent, respectively. In other words, theslowdown in the rise of earnings levels since theearly 1990s is primarily explained by the slow-down of inflation, whereas the rise in real earn-ings has slowed to a lesser extent.

For the past 30 years, the index of wage andsalary earnings has been updated at five-year in-tervals. Regular revisions are needed in order tokeep the index’s weight structure and classifica-


49 55 60 65 70 75 80 85 90 95 00 05

0

10

20

30

40

–10

%-change

Index of wage and salary earnings

real earnings

Figure 1.Annual changes in earnings level and real earnings 1949–2007

0

1

2

3

4

5

6

7

_2006Q1 _2006Q2 _2006Q3 _2006Q4 _2007Q1 _2007Q2 _2007Q3 _2007Q4 _2008Q1 _2008Q2 _2008Q3

%

2005=100 2000=100

Figure 2.Indices of wage and salary earnings 2005=100 and 2000=100,annual changes

tion of wage and salary earners up to date withthe changes happening in the labour market.Following the previous revision, Statistics Fin-land began in autumn 2004 to compile a regularearnings index 2002=100, which excluded per-formance rewards from the earnings of monthlysalary earners; in the wage and salary earnings in-dex these were included as part of the earningsof monthly salary earners, although not ofhourly-paid employees.

The main revisions made in connection withthe update of the wage and salary earnings index2005=100 were as follows:– performance rewards were included in the

earnings concept for hourly-paid employees,– performance rewards and one-offs based on

collective agreements were included in the in-dex as calendar year averages,

– regular weekly overtime per annum wasadded to the earnings concept for teachers inlocal government run schools, and

– the classification of industries was revised forconsistency with the Standard IndustrialClassification 2008.In connection with the scheduled revision of

the wage and salary earnings index 2005=100,the regular earnings index was also adjusted tothe base year 2005. The revisions made to theregular earnings index were smaller because theone-offs updated in the index of wage and salaryearnings are not included in the index of regularearnings.

The equal allocation between all four quar-ters of one-offs based on collective agreements isreflected in the development of the wage andsalary earnings index 2005=100 in such a waythat for those quarters where one-off paymentshave been made, the 2005=100 index has risenmore slowly than the 2000=1000 index. In thosequarters where one-off payments have not beenmade, the 2005=100 index has risen more rap-idly than the 2000=100 index.


2 What do the index of wage and salaryearnings and the index of regular earningsmeasure?

2.1 Index of wage and salary earnings includes performancerewards and one-offs based on collective agreements

Both the index of wage and salary earnings andthe index of regular earnings measure the deve-lopment of average earnings for regular workinghours. The measurements provided by the twoindices of the development of earnings are other-wise the same, but the earnings concept in theindex of wage and salary earnings includes per-formance rewards and one-offs based on collec-tive agreements, which are not covered by theindex of regular earnings. In other words the reg-ular earnings index measures permanent changesin income, whereas the wage and salary earningsindex also includes occasional income items.Otherwise the two indices use the same wagedata, wage sum weights and compilation rules.

Regular working hours are determined on thebasis of the unit tariff of wages. This means thatfor wage earners paid on an hourly basis, the in-dices measure changes in hourly earnings duringregular working hours. For salaried employees,

the indices measure the development ofmonthly earnings among full-time employees.The wage and salary period may also includedays off with or without pay.

For wage earners paid on an hourly basis, thelabour input unit is fully standardised: it de-scribes their hourly wages. For salaried employ-ees, a change in the volume of labour input mayin some instances influence their level of earn-ings. For example, a reduced number of weeklyworking hours will be reflected in a negativeearnings trend, even if hourly earnings remainunchanged. A temporary change in paid workinghours (e.g. through layoffs or unpaid leaves ofabsence) has only a partial effect on monthlyearnings. Nor does the index describing the de-velopment of earnings for regular working hoursreflect the effect of the amount of overtime orovertime raises on the level of earnings.

2.2 Work duties partly standardised

The fixed-weighted wage earner groups in thewage and salary earnings index are largelyformed by industry or by field of contract. Thismeans that the differential development of la-bour input in different employer sectors, indus-tries or for hourly-paid wage earners and salariedearners has no effect on the index. By contrast,any qualitative changes within these wage and

salary earner groups, such as the introduction ofnew duties, the removal of old duties or a rise ineducational level, will be reflected in the deve-lopment of earnings described by the index. Inpractice the index measures the average deve-lopment of earnings for regular working hours indifferent industries.

2.3 Focus on earnings for normal working hours

Monthly earnings for normal working hours in-clude the following wage and salary items:– basic pay,– bonuses paid on grounds of job tasks, profes-

sionals skills and competencies, years of em-ployment, etc.,

– bonuses paid on grounds of workplace loca-tion and circumstances,

– working hours bonuses,– employees’ results and performance-based

pay,– workers’ performance-based earnings and


– taxation value of fringe benefits.The content of earnings for normal working

hours may vary somewhat depending on thewage statistics consulted. In hourly wage statis-tics, for instance, earnings for normal workinghours include wages paid for time work, piecework and reward-based work done during regu-lar working hours as well as basic amounts ofSunday or overtime pay, but not pay incre-ments. Wage statistics for hourly-paid workerscomprise the above-mentioned items usually forregular working hours. For hourly-paid workersthe concept of earnings does not comprise allthose items that are correspondingly includedfor salaried employees. Examples include fringebenefits, age increments and Sunday bonuses incertain industries as well as irregular results-de-pendent items. Since the late 1980s earnings fornormal working hours have in many hourly-paidindustries (e.g. metal industry, sawmill industry,board and woodworking industry, and the publicsector) additionally included the compensationawarded to wage earners for reduced workinghours in the form of a corresponding increase inhourly wages.

The concept of earnings applied in the indexof wage and salary earnings excludes the follow-ing items:– earnings from overtime and extra work,– holiday-pay bonus and end-of-holiday com-

pensation,– cash bonuses,– trade cycle compensation in the paper indus-

try,– seniority increments in those hourly-paid in-

dustries (metal, paper, rubber, textiles, cloth-ing, wood and woodworking industry) wherethey are not included under earnings for nor-mal working hours and

– initiative bonuses not included in wage statis-tics.

Statistics Finland publishes a separate labourcost index to measure the development of em-ployer outlays on wages, salaries and social secu-rity contributions as calculated per workinghour. EU Member States have developed a newsample-based quarterly labour cost index2008=100, which in Finland was published forthe first time in summer 2009.


3 Index classifications and weight structureThe following classifications are used in compil-ing the index of wage and salary earnings:

– employer sector,– industry,– hourly wage earners and monthly salary earn-

ers, and– wage data.

The classifications used in the wage and sal-ary earnings index determine the base level fromwhich the indices for the wage and salary earnercategories that are used in computing the indexare weighted to obtain larger wage and salaryearner categories. The classifications used willinfluence the way that changes in the structureof employees impact the development of the in-dex. These relative structural changes are not re-flected in the indices for wage earner groups at

sum level, because the development of the indexfor a wage earner group aggregated using a fixedweight structure is always the weighted averagefor the lower-level employee groups within thatcategory of wage earners. Internal structuralchanges within the lowest-level wage earnergroups, by contrast, will be reflected in the in-dex. This is most evident in situations where theproportion of job tasks requiring higher skillsand competencies increases in a certain industry.In this case the change in average earnings forthe industry will be faster than the change inaverage earnings from individual job tasks.

The index of wage and salary earnings is pub-lished by sector, by industry and separately forhourly-paid and monthly-paid employees. It isnot published separately for different sources ofwage data.

3.1 Employer sector and wage data

The wage and salary earnings index identifiesfour employer sectors: private, state, municipaland others. The latter comprises non-profit or-ganisations such as Evangelical-Lutheran pa-rishes, labour market organisations, foundationsand social funds outside the state or municipalbudget system. The state sector only comprisesunits within the state budget system, i.e. all wagedata for publicly-owned corporations are givenunder the private sector.

3.1.1 Wage data

The basic data for the private sector consist ofdatasets compiled by employer organisations.Private sector datasets that are treated separatelyinclude the following:– service sector sample,– dataset for Confederation of Finnish Indus-

tries EK industrial branches,– dataset for Confederation of Finnish Indus-

tries EK service branches,– dataset for road transport,– dataset for auto trade and garage business,– sample for industrial branches,– dataset for real estate services, and– dataset for agriculture and forestry.

Datasets from the non-profit-making sector in-clude:– municipal service institutions,– dataset for monthly-paid salaried employees

of Evangelical Lutheran parishes,– dataset for theatre employees,– dataset for child instructors in the employ of

Evangelical Lutheran parishes, and– dataset for service institutions’ employer

association.

In addition, wage and salary earners in certainindustries from the EK dataset and private sectorsample are categorized in the non-profit-makingsector.

Data collected through Statistics Finland’swage and salary surveys are used to complementwage statistics compiled by organised employersin those industries where the proportion of or-ganised employers is lower than average e.g. onaccount of the high number of small firms. Thesample survey is an important source in calculat-ing wage and salary indices for such branches asbuilding and construction, trade, road transportand business activities.

One difficulty with the use of sample wagedata in calculating the index of wage and salaryearnings is presented by the standard error that isintroduced in average earnings: this can give rise


to considerable random variation in calculatingthe development of earnings. On the other handat the industry level where the wage and salaryindex is published, series based on sample mate-rials are not normally very dominant. As for wagedata obtained from organised employers only,the problem here is that these companies tend tobe much larger on average than non-organisedbusinesses in the same industry. In many indust-ries small companies specialise in certain pro-ducts or services, or their operation is otherwisedifferently oriented than that of major com-panies. It follows that earnings trends for non-or-ganised employers may differ systematically fromthose of organised employers. There are some in-dustry differences in the earnings levels of em-ployees in organised and non-organised com-panies, but there is no research evidence tosuggest significant differences in earnings trends.

3.1.2 Weight structure byemployer sector

The weight structure of the wage and salaryearnings index 2005=100 by employer sector isconsistent with the wage sum structure in the2005 National Accounts. The wage and salarysums indicated in the National Accounts de-

scribe all wages and salaries paid in the nationaleconomy, including those paid in the greyeconomy.

The private sector accounts for around 70per cent of the wage and salary earnings index.The main explanation for the growing weight ofthe private sector and accordingly for the declin-ing weight of the state sector from 1990 to 1995lies in the transfer of publicly-owned corpora-tions and state enterprises into the private sec-tor. This change was initially made in the1990=100 index in 1995, when it accounted for3.7 per cent of the total wage sum for all wageearners. During the recession of the 1990s,therefore, the weight of the private sector in theindex of wage and salary earnings would havedecreased without this structural change.

From 1995 to 2000 the sector classificationof the wage and salary earnings index remainedeffectively unchanged. The increase in the rela-tive weight of the private sector was due insteadto the strength of economic growth in general.The total wage and salary share of the municipalsector has been fairly stable since 1990. Part ofthe reason for the increasing weight of employ-ers in the non-profit-making sectors lies in theimproved coverage of the wage data used incompiling the index of wage and salary earnings.

3.2 Industry

3.2.1 Industrial classification

Work to develop and publish the wage and sal-ary earnings index 2005=100 was started in Au-

gust 2008 based on the 2002 standard industrialclassification (SIC 2002), even though it wasknown at the time that during 2009 StatisticsFinland would be adopting the new SIC 2008


Others

Central government

Municipalities

Private

3,5

11,1

19,8

64,6

2,3

8,1

20,7

68,9

3,3

7,1

19,5

70,1

3,9

7,0

19,5

69,5

0 10 20 30 40 50 60 70 80

%

2005=1002000=1001995=1001990=100

Figure 3.Weight structure of wage and salary earnings indices 1990–2005

classification. However, at this point the wagedata that are used in compiling the wage and sal-ary earnings index were not yet available underthis new classification; in the meantime thechangeover to the new classification proceededas planned. In quarterly statistics, such as the in-dex of wage and salary earnings and the index ofregular earnings, the new SIC 2008 classificationwas introduced for 2009 data.

The publication of the new wage and salaryearnings index by industry was resolved by con-tinuing to publish the 2000=100 industry indexin August 2008, even though all calculations atthis time were based on the 2005=100 index.

SIC 2008 was used for the first time to com-pile the wage and salary earnings index2005=100 in the Q1/2009 publication, whichwill be out on 29 May 2009. At the same time,industry indices were published using the baseyear 2005=100. However, indices with old baseyears will continue to be published using thesame industry classifications with which theywere originally produced.

The main SIC 2002 industry categories are asfollows:– A Agriculture and forestry,– D Manufacturing,– E Energy and water supply,– F Construction,– G Wholesale and retail trade; repair of motor

vehicles,– H Hotels and restaurants,– I Transport, storage and communication,– J Financial intermediation,– K Real estate, renting and research services;

business activities,– L Public administration and defence; compul-

sory social security,– M Education,– N Health care and social services, and– O Other community, social and personal ser-

vice activities

The corresponding SIC 2008 categories are asfollows:– A Agriculture, forestry and fishing,– C Manufacturing,– D Energy supply,– E Water supply and waste management,– F Construction,– G Wholesale and retail trade; repair of motor

vehicles,– H Transport and storage,– I Accommodation and food service activities,– J Information and communication,

– K Financial and insurance activities,– L Real estate activities,– M Professional, scientific and technical activi-

ties,– N Administrative and support service activi-

ties,– O Public administration and defence; com-

pulsory social security,– P Education,– Q Human health and social work activities,– R Arts, entertainment and recreation, and– S Other service activities

The content of the SIC 2008 main headings dif-fer from the corresponding SIC 2002 headings.The extent of these differences varies by cate-gory. The main differences between the old andnew categories are as follows:– Publishing activities are moved from manu-

facturing to the newly created section J, In-formation and communication. In SIC 2008,the repair, service and installation of machin-ery and equipment constitute a separate in-dustry. However, in the wage and salary earn-ings index these functions remain in the cate-gory of manufacturing industries.

– Energy supply constitutes a separate sectionD, while water supply is combined withwaste management to form section E.

– In SIC 2008, telecommunications no longerbelongs to the transport and storage category,but comes under section J Information andcommunication. This section furthermorecomprises radio and television activities, com-puter and related services, publishing andelectronic programme production.

– Most of the SIC 2002 category K Real estate,renting and research services; business activi-ties is now divided between two new catego-ries, M Professional, scientific and technicalactivities and N Administrative and supportservice activities. Support service activities in-clude travel agencies, security services andreal estate management.

– In SIC 2008, SIC 2002 section O Other com-munity, social and personal service activities,is mostly divided between the new categoriesR Arts, entertainment and recreation and SOther service activities. However in contrastto SIC 2002, section R does not compriseelectronic communication, which in SIC2008 comes under J Information andcommunication.

The wage and salary earnings index 2005=100has a total of 70 fixed-weight industries, com-


pared to 53 in the 2000=100 index. A somewhatmore detailed industrial classification was ap-plied so that SIC 2002 industries could beformed into SIC 2008 industries at the level atwhich the indices are published. Another reasonfor the increased number of industries was thatthe use of Statistics Finland’s own sample wasextended to apply to an increasing number of in-dustries.

3.2.2 Production and publication ofold indices by industry

The industry-specific wage and salary earningsindices for old base years are chained with corre-sponding industry indices in the new index. Be-cause of the changes made to the industrial clas-sification, the population of wage and salaryearners covered by the old industry indices isnot necessarily identical with the industrialclassification used in the old indices. As a rule,however, the differences have not been so greatas to prevent the construction of old industryindices.

Indices of wage and salary earnings 2000=100continues to be published based on the SIC20002 classification even after the SIC 2008 wasintroduced in the Q1/2009 publication. Olderindices of wage and salary earnings will also becomputed with their original industrial classifica-tion.

3.2.3 Industry weights

In the private sector, the industry weights aresimilar to the total wage and salary sums re-ported in the National Accounts, but in the pub-lic sector the industry weights are based on theresults of the 2005 structure of earnings survey.With the exception of agriculture and forestry,the weight shares of different wage earnergroups in each industry are based on wagestructure statistics.

In principle it would have been possible todetermine the weights for the wage and salaryearnings index almost entirely on the basis ofwage structure statistics. However, these statis-tics do not cover businesses with less than fiveemployees. This means that in industries with asignificant proportion of small businesses (suchas construction and wholesale and retail trade),the weights would have been too low. On theother hand the weights of the wage structurestatistics would have corresponded more closelyto the wage data that are available for compilingthe wage and salary earnings index.

Examined by SIC 2002 categories, the big-gest increase in the wage sum proportion be-tween 2000 and 2005, at 2.7 per centage points,is seen in section K, which includes business ac-tivities, real estate activities, computer and re-lated activities, accounting firms and consul-tants. Marked growth was also recorded for


4,5

12,4

7,6

6,8

13,8

2,4

6,3

2,3

11,7

7,0

23,3

3,8

12,0

7,9

6,5

11,1

2,8

7,7

2,4

10,0

7,2

25,2

0,0 5,0 10,0 15,0 20,0 25,0 30,0

Other service activities

Health and social work

Education

Public administration and defence

Real estate, renting and business activities

Financial intermediation

Transport, storage and communication

Hotels and restaurants

Wholesale and retail trade

Construction

Manufacturing

%

2000

2005

Figure 4.Industry weights for wage and salary earnings indices 2000=100and 2005=100, SIC 2002

wholesale and retail trade, reaching 1.7percentage points during this period. The sharp-est fall between 2000 and 2005 was seen in man-ufacturing, whose share decreased by 1.9centage points. The figures for manufacturingpeaked in 2000, whereas in the next base yearfor the wage and salary earnings index in 2005,the cyclical peak was still a couple of years awayand the forest industry was plagued by a majorindustrial dispute. The weight of the transportand communication section has declined in the2005=100 index because the new index of wageand salary earnings does not include maritimetransport on account of the poor availability ofwage data for this industry.

If there are sharp and sudden changes in theindustry weight structure, an index that is basedon the base year weight structure may yield re-sults that do not reflect the real situation. It isnot the change in weight structure itself that un-

dermines the accuracy of the index, but if this iscoupled with differential wage and salary trendsin different industries, then the overall index willinevitably be distorted. During the calculation ofthe wage and salary earnings index 1990=100,from the year it was published in 1993 up to1998, construction had far too great weightwhen compared to the real situation in1991–1998. With earnings in construction mo-ving well below the average rate of growth be-cause of the recession, the excess weight ofconstruction has acted to slow the developmentof the wage and salary index compared to what itwould have been using a more up-to-date weightstructure. In the 2000s the changes occurring inwage trends in different industries and weightstructure have been less pronounced, so in thisrespect the use of base year wage sum weightshas not caused significant bias in the calculationof the index.

3.3 Classification of wage and salary earners

In each industry a distinction is made betweenhourly-paid wage earners and monthly-paid sal-ary earners, which have their respective fixedwage and salary weights. In virtually all indus-tries used in the calculations, there exists one ormore average earnings series for monthly-paidsalary earners. On the other hand there is a largenumber of such industries where there are nohourly-paid wage earners or where their numberis so small that no average earnings series hasbeen formed. Total wages and salaries for each

industry have been divided between hourly-paidwage earners and monthly-paid salary earners onthe basis of the figures obtained from the 2005structure of earnings statistics. In agriculture andforestry, which are not covered in the wagestructure statistics, total wages and salaries aredivided on a computational basis using the num-ber of wage earners and earnings level.

Over 20 years the weight share of hourly-paidwage earners in the index of wage and salary ear-nings has dropped steadily from 30.6 to 22.1 per


0,0

10,0

20,0

30,0

40,0

50,0

60,0

Private Municipalities Central government Others

Hourly paid Monthly paid

%

Figure 5.Sectoral weight structure for the index of wage and salary earnings2005=100

cent. Major reasons for this include the growth ofautomation, leading to a declining proportion ofemployees directly engaged in production, andthe growing proportion of salaried employees inplanning functions. In the state sector virtuallyall and in the municipal sector the majority of

employees are monthly paid salary earners. It fol-lows that the total index for hourly-paid employ-ees is based almost exclusively on the develop-ment of earnings in the private sector.

3.4 Gender

With just a few exceptions, the base series forthe index of wage and salary earnings includeparallel gender series. The wage and salary indi-ces for men and women are calculated on the ba-sis of these series. However, gender is not other-wise used as a basis for calculating the officialwage and salary earnings index, which draws ona series that comprises both genders. Out of thetotal wage sum paid to all wage and salary earn-ers, women accounted for 44 percentage pointsin the 2005=100 index. In the 2000=100 indexwomen accounted for 42 per cent and in the1995=100 index for 43 per cent. The relativeweight of genders has been particularly influ-

enced by the industry structure of Statistics Fin-land’s own sample as well as by differential busi-ness trends in different industries. In the privatesector the weight of women is about 35 percent, in the municipal sector 73 per cent and inthe state sector 43 per cent. Among montly paidsalary earners the proportion of women is higherstill. Women’s share has increased in all but thenon-profit-making sector.

In the fourth quarter of 2007, women’s earn-ings averaged 80.7 per cent of men’s earnings ac-cording to the index of wage and salary earnings2005=100.


0

5

10

15

20

25

30

35

40

45

50

Private Municipalities Central government Others

Men Women

Figure 6.Weight of men and women in different sectors in the index of wageand salary earnings 2005=100

4 Calculation of indices

4.1 Calculation of average earnings

The calculation of the index of wage and salaryearnings is based on average earnings data, whichare computed using wage data supplied by em-ployer organisations as well as Statistics Finland’sown sample. For hourly-paid wage earners, earn-ings for regular working hours include wagespaid for time work, piece work and re-ward-based work done during regular workinghours as well as increments for shift work andadverse working conditions. In addition, basicamounts of Sunday or overtime pay are includedin earnings for regular working hours, but notpay increments. For monthly-paid salaried em-ployees, mean earnings are determined in the ba-sis of income for regular working hours, exclu-

sive of payment for extra work and overtime andon-call payments.

For the calculation of the mean earnings ofmonthly-paid employees, those salaried wageearners are included whose working hours ac-count for over 90 per cent of general workinghours in that industry. For hourly-paid wageearners, all employees are included except forthose who for various reasons do not receive fullpay.

The index of regular earnings does not in-clude performance rewards or one-offs based oncollective agreements for either hourly-paidwage earners or monthly-paid salary earners,whereas they are included in the earnings con-cept of the index of wage and salary earnings.

4.2 Calculation of indices from average earnings

The index of wage and salary earnings and theindex of regular earnings are Laspeyres unitvalue indices with fixed weights at the industrylevel. The fixed weight structure also extends tohourly-paid and monthly-paid employees sepa-rately in each industry. There are a total of 178so-called official index series that are weightedtogether by using fixed weight shares. Indicesare calculated from the average earnings in theseseries by dividing them with the average earn-ings of the corresponding 2005 series. TheLaspeyres formula for calculating aggregatedwage and salary indices (and regular earnings in-dices) is as follows:

ATIw

wt

iSTA

STAO

i

i t

i=

∑ ∑

100 ** ,

or

ATIw ATI

wti i t

i

=

∑ ∑

** , when

wi = total wages and salaries for wageearner group in 2005

ATI i t, = the index of wage and salary earningsfor wage earner group i in quarter t

STAi t, = average earnings for regular workingtime of wage earner group i inquarter t

STAOi = average earnings for regular workinghours in wage earner group i in 2005

In some industries there are several base se-ries, in which case the average earnings for theseseries are calculated by using the number ofwage and salary earners to weight them togetherto the industry level. There are a total of 216such base series in the wage and salary earningsindex.

Since there are no fixed weights in the baseseries, the changes taking place in the structureof wage and salary earners within industries willalso influence the development of the index. Inthis sense the wage and salary earnings index isnot a price index unaffected by quality changes,but instead a unit value index that measures thedevelopment of average earnings for regularworking hours in different wage and salaryearner groups. Data on employee numbers areadded into the system for calculating the wageand salary earnings index at the same time as av-erage earnings are updated. Since the base seriesof the wage and salary index are not updated forevery quarter, average earnings are weighted to-gether for preliminary data and for intermediatequarter by using the latest updated figures avail-able.


4.3 Calculation of the development of teachers’ earnings

Both in the index of wage and salary earningsand in wage statistics, teachers’ earnings for reg-ular working hours were previously calculatedusing an earnings concept that included no in-come for overtime. Since the 2007 municipalwage statistics, regular weekly overtime has beenadded to the concept of regular earnings, and thesame revision has been made to the index ofwage and salary earnings 2005=100.

However, the wage and salary earnings index2005=100 does not monitor the development ofteachers’ earnings including earnings for regularweekly overtime as such; instead it standardisesthe overtime hours that are added to the earn-ings concept used. With the base year for thenew index set at 2005, weekly overtime is stand-ardised to the level of base year 2005.

In municipal wage statistics no specific qualityadjustments are made to the number of weeklyovertime hours because that number has no im-pact on the wage statistics published. Therefore,for purposes of the index of wage and salary earn-ings, a separate limit was set to the number ofweekly overtime hours so that earnings for over-time may vary from 50 per cent to 150 per centrelative to earnings from the minimum numberof teaching hours required. Using this limit, thenumber of regular weekly overtime hours for2005 came to 2.29 per week. For the index of

wage and salary earnings, therefore, regular earn-ings for teachers were computed so that a propor-tion equivalent to earnings from 2.29 weeklyovertime hours were included in the regularweekly overtime hours for other years. The fol-lowing provides an example of how the develop-ment of earnings from 2005 to 2006 is calculatedin the index of wage and salary earnings:Regular earnings without weekly overtime in2005: 2,696 €

Regular earnings without weekly overtime in2006: 2,767 €

Earnings from weekly overtime in 2005: 190 €

Earnings from weekly overtime in 2006: 204 €

Weekly overtime hours in 2005: 2.29Weekly overtime hours in 2006: 2.39Regular earnings with weekly overtime in 2005:2,696 + 190 = 2,886Hourly earnings from weekly overtime in 2006:204 / 2.39 = 85.1

Earnings from weekly overtime with standard-ised number of hours of teaching in 2005:2.29 * 85.1 = 195Regular earnings with standardised weekly over-time hours in 2006:2,767 + 195 = 2,962Development of earnings 2005–2006:((2,961–2,885) / 2,885) = 2.6%

4.4 Preliminary information

The wage and salary earnings index and the reg-ular earnings index are published quarterly, fiveto eight weeks after the end of each quarter. Thetime lag is greater with the first and second quar-ter publications because of the large amount ofwage data that are completed at that time. Sinceit takes considerably longer to complete thewage statistics that are used in compiling thewage and salary earnings index, it is always nec-essary to make at least one estimate of averageearnings for all series. In series that are updatedonce a year, the time lag between the publishedquarter and the last quarter based on real,updated figures may be more than one year.

The preliminary data for the index of wageand salary earnings and the index of regularearnings are calculated by using development es-timate indices. These involve four components:

– index of negotiated wages and salaries (to theaccuracy of one month),

– index of wage drift estimate (to the accuracyof one quarter),

– index of performance rewards (to the accu-racy of one year), and

– one-offs based on collective agreements (tothe accuracy of one year)

The index of negotiated wages and salaries es-timates the impact of rises specified in collectiveagreements on average wage costs. Since pay ri-ses set out in collective agreements may be intro-duced during the course of a quarter, this indexis compiled on a monthly basis. The wage driftindex estimates the development of regular ear-nings at the individual level in addition to nego-tiated rises as well as the impact of structuralchanges on earnings levels. Indices of negotiated


wages and salaries and wage drift indices are ba-sed on estimates of earning levels for each monthrelative to the December of the previous year.

4.4.1 Estimating the developmentof regular earnings

The latest index point figures for the index ofwage and salary earnings and the index of regularearnings are preliminary data. The first stage inconstructing the preliminary data for these indi-ces is to assess the development of regular earn-ings on the basis of collective wage agreementsand estimates of wage drift. The estimates ofregular earnings are used as such to calculatepreliminary data for the index of regular earn-ings, whereas the preliminary data for the indexof wage and salary earnings are obtained by add-ing to the estimates of regular earnings figuresfor the development of one-offs based on collec-tive agreements and estimates of the develop-ment of performance rewards.

Estimates of the development of regularearnings are calculated by using the so-calledSPILIU index, in which the index of negotiatedwages and salaries is multiplied by the index ofwage drift estimate and divided by 100. Thereare a total of 95 such dual-component indices inthe wage and salary index and the index of regu-lar earnings that are specifically intended for pre-dicting earnings trends. The quarterly indices arethus obtained as averages of monthly indices. If acontractual pay rise comes in the middle of abase series whose earnings data are from a spe-cific month, the imputed average earnings forthe quarter will be different from the earningsdata for the updated month. The average earn-ings for this quarter are calculated as follows:

STA STAi t i mI

Ii t

i m, , * ,

,= , when

ISPI LIU

ii i=*

100and

STAi t, = average earnings for wage earnergroup i during quarter t

SPI i = index of negotiated wages and salariesLIU i = wage drift indexm = updated montht = quarter within which updated

month falls

The preliminary information is calculated onthe basis of the development estimate indexusing the following formula:

SANII

ISANIi t n

i t n

i ti t,

,

,,*+

+= when

I = index based on earnings developmentestimate

i = wage and salary earner groupt = quarter based on empirical evidencet+n = the forecasted quarter which is n

quarters later than the last quarterbased on empirical material

Earnings trends are estimated together withlabour market organisations. Experts from theState Employer’s Office and the Commission forLocal Authority Employers are consulted to ob-tain estimates of earnings trends in the publicsector. Separate estimates are produced forteaching and medical staff in the local authori-ties because the pay rises negotiated for thesegroups may differ from the general pattern. Inthe private sector calculations prepared by theConfederation of Finnish Industries EK are re-ferred to especially for purposes of estimatingthe effects of negotiated wage contracts. Devel-opment estimates for employers in organisedbusinesses are also applied to average earningsseries in non-organised companies.

4.4.2 Adding one-offs to regularearnings

Regular earnings are calculated in identical waysboth for the index of regular earnings and for theindex of wage and salary earnings. For the wageand salary earnings index, performance rewardsand one-offs based on collective agreements arefurthermore added to regular income. Both ofthese one-offs are added to regular earnings asannual averages, which means that these annualone-offs are added to each quarter of the calen-dar year as a proportion of regular earnings. Theaddition of one-offs to regular earnings thereforehas no impact on the development of the indexof wage and salary earnings within the year con-cerned. If the same amount of one-offs were en-tered into each quarter, the addition of one-offitems to regular earnings would slow the annualdevelopment of the index of wage and salaryearnings.

In industry-specific wage data performancerewards are usually monthly averages derivedfrom annual figures. This means that the propor-tion of performance rewards for the year in ques-tion is obtained by dividing the sum of perfor-mance rewards by the sum of regular earnings forthe year in question.

tultul

sansy

y

y% = , where


sans y = annual earnings for regularworking hours

tul y% = performance rewards as a proportion

of annual earnings

Performance rewards for hourly-paid employ-ees are updated using Confederation of the Finn-ish Industries EK annual earning statistics, whichare also applied to the wage earner groups in Sta-tistics Finland’s own sample. In EK annual statis-tics, one-offs are calculated relative to the num-ber of hours worked, which means that the pro-portion of the one-off item will be somewhathigher than when regular working hours are used.On the other hand, annual earnings statisticscover a larger number of wage earners than quar-terly wage statistics, which has the effect of re-ducing the proportion of performance rewards.

There are two alternatives to calculating theshare of one-off payments based on collectivewage agreements. The one-off item may be ei-ther a percentage share of monthly pay, or itmay be a set euro amount. The percentage shareone-offs is calculated by dividing the amount ofone-off payments by twelve:

kerker

.%%ykk

=12

The share of the one-off payments in EUR isobtained by dividing the payment by the annualsum of regular earnings:

kerker

.%y eur

ysans=

One-off payments based on collective agree-ments items are not included in industry wagestatistics. Therefore their amounts are not calcu-lated separately, but the necessary data for cal-culating their shares are obtained from collectivewage agreements.

To obtain the earnings that are needed to cal-culate the index of wage and salary earnings,then, performance rewards and one-off pay-ments based on collective agreements are addedto regular earnings.

ansiotul

sansATIy y

SANI=+ +( ker )

*% %100100

, where

ansioATI = wage used calculation the Index of wa-ge and salary earnings

sans SANI = regular earnings

Since one-off payments are divided equallybetween each quarter, changes in the size ofthese payments are always reflected in the dif-ferences between the last quarter of the previousyear and the first quarter of the next year. In thecase of one-off payments based on collectiveagreements, the change may be seen immedi-ately when the index for the first quarter is pub-lished. True information on the development ofperformance rewards is only obtained when thewage statistics are completed, so it may take upto 18 months for changes in performance re-wards to filter through to the following year’spublished indices of wage and salary earnings.

4.5 Intermediate quarters

Most of the base series for the index of wage andsalary earnings are updated once a year. Some se-ries for hourly-paid workers in the private sectorare updated every other quarter. When a wagedata item in a base series is updated, the quartersin-between two updated quarters are upgradedfrom preliminary quarters into so-called interme-diate quarters. Since real average earnings maydiffer considerably from the initial estimates,there are no grounds to rely only on the develop-ment estimate formula for purposes of calcula-ting intermediate quarters. Intermediate quartersbased on preliminary estimates will not necessa-rily be in line with real developments. This iswhy when average earnings are updated, inter-mediate quarters will also be automaticallyupdated. The intermediate quarters arerecalculated using the following formula:

ATI IATI

I

nki

t nit n i

t k

it k

+ ++

+= + * , where

I = index based on estimate of earningsdevelopment

i = wage or salary earner groupt = previous quarter based on empirical

evidencen = distance in quarters between forecasted

quarter and previous quarter onempirical evidence

k = distance in quarters between statisticalquarters

The difference between estimated and realaverage earnings is thus divided across the pe-riod between two points of update in line withthe linear accumulation function.


5 Old indices and other outputsStatistics Finland will continue to calculate andpublish the index of wage and salary earnings forolder base years as well. The base year for thefirst index of wage and salary earnings is 1938;uninterrupted series are available from 1948 on-wards. As from 1975 the index of wage and sal-ary earnings has been revised and upgraded atfive-year intervals. Old wage and salary earningsindices have been calculated independently up totheir chaining points; from there on they are cal-culated via newer indices. This chaining point hasusually been set at a couple of years after the baseyear of the new index. It follows that the new in-dex and old indices may develop somewhat dif-ferently between the base year for the new indexand the chaining points of the old indices. For in-stance, the index of wage and salary earnings2000=100 was calculated separately until the lastquarter of 2006, since when percentage changeshave been the same as in the new index.

The coverage of wage and salary indices hasexpanded over time. Below is a brief descriptionof the structures of old indices up to 2000:

Wage and salary earnings indices for differentindustries are published with base year2000=100 based on SIC 2002. The quarterly

publications of the index of wage and salary ear-nings 2000=100 and 1995=100 provide separatestatistics for different employer sectors and forhourly-paid and monthly-paid employees. Forwage and salary earnings indices 1990=100,1980=100, 1975=100 and 1938=100, only indi-ces for all wage earners are published. The annu-al annex to the index of wage and salary earningsprovides the 1964=100 index by sector and the1985=100 index by industry and by sector.

5.1 Average earnings

The data collected for the index of wage and sal-ary earnings can also be used to calculate wageand salary earners’ average monthly wages,which are defined in the same way as in the in-dex proper as earnings for regular working hoursincluding performance rewards and one-offs.The average hourly earnings of hourly-paidworkers are translated into average monthlyearnings by using the standard coefficient of170. The average earnings in the base series ofthe wage and salary earnings index are weightedtogether by the number of wage and salary earn-ers, which is regularly updated.

In the quarterly index publication the devel-opment of average earnings is presented in tabu-lar form by employer sector for hourly-paid andmonthly-paid employees.

The average earnings published in the wageand salary earnings index differ somewhat fromthe figures given in wage statistics and wagestructure statistics. This is explained among oth-ers by the following reasons:

– earnings in the wage and salary earnings indexinclude one-offs based on collective agree-ments,

– the wage and salary earnings index does notcover all employees included in the wage sta-tistics,

– average earnings in the wage and salary earn-ings index are quarterly averages, whereas theaverage earnings in wage statistics are usuallyfor a certain month, and

– earnings in wage statistics are raised to thelevel of all wage earners.The earnings data provided even by the most

recent wage statistics may be over 18 monthsold, which means that the preliminary data onaverage earnings contained in the wage and sal-ary index are certainly more up-to-date. The av-erage earnings data indicated in the wage andsalary earnings index for the state and municipalsector are relatively closely in line with the aver-age earnings data given in industry wage statis-tics. In the private sector the differences be-


Base year sector industry hourly /monthlypaid

gender

1938=100 X X X*1964=100 X X X*1975=100 X X X*1980=100 X X X*1985=100 X X X X1990=100 X X X X1995=100 X X X X2000=100 X X X X

*) In the oldest indices figures for hourly-paid and monthly-paid

employees are only calculated to the level of all wage earners

Table 1.Classifications of old wage and salary earningsindices

tween the two sets of figures may be wider,among other reasons because of differences in

the earnings concept and different weightingprocedures.

5.2 Index of negotiated wages and salaries

The index of negotiated wages and salaries mea-sures the effect of collective agreements on aver-age earnings for regular working hours. The in-dex is calculated annually as a chained index us-ing the same weight structure as in the wage andsalary index. The effects of negotiated pay risesare estimated in relation to the earnings level asat the previous year-end. The index of negoti-ated wages and salaries does not cover com-pany-specific pay rises or the effects of structuralchanges. This index is mainly intended for pur-poses of checking the wage and salary index and

for use by labour market organisations. The in-dex is not published at the industry level.

The index of negotiated wages and salariesprovides a reasonably accurate measure of theimpacts of labour market organisations’ agree-ments on wage levels. On the other hand if thetendency to local-level bargaining on pay risescontinues to gather momentum, it will becomemore and more difficult to assess how much ofthe rise in earnings levels is attributable to col-lective agreements and how much to wage driftand structural change.

5.3 Real earnings index

The real earnings index measures the develop-ment of earnings levels unaffected by changes inconsumer prices. The purpose of the index is todescribe the amount of goods that wage and sal-ary earners can purchase at any point in time withtheir nominal earnings. The purchasing power ofwage and salary earners is also affected bychanges in taxation, so changes in the purchasingpower after taxes may differ somewhat fromchanges indicated by the real earnings index.

The real earnings index is calculated directlyas a ratio of the index of wage and salary earn-ings and consumer price index for the same baseyears.

ATIREATI

KHItt

t

= *100, where

ATIt = the index of wage and salaryearnings for quarter t and

KHIt = consumer price index for quarter tduring the same base year.

Data on trends in real earnings are publishedin the annual summary attached to the quarterlywage and salary index publication.


6 Uses and application of indicesThe principal use of the index of wage and salaryearnings is to serve as background material forthe social partners in the process of collectivebargaining. It provides information on past earn-ings trends and wage drifts in different industriesas well as a basis for assessing future trends, thus

facilitating the search for a common understand-ing of past and future earnings trends. The de-tailed breakdown of wage and salary earners intodifferent categories and the wide range of index-ation options available also make it a powerfultool for analyses of earnings trends.

6.1 Indexation rules currently in force in Finland

Legislation in Finland has restricted the applica-tion of the index clause since 1968. The currentlegislation in force (Act on Limiting the Use ofIndex Clauses 1195/2000) dates from 2000. Thelaw has been updated in several occasions, andits validity has been extended with minor revi-sions through to the end of 2009. The Act speci-fies a number of instances where the use of in-dex clauses is allowed.

Employment pensions are revised annuallybased on an employment pensions index. Themagnitude of index revisions depends onchanges in consumer prices and wages. In theemployment pensions index changes in pricelevels account for 80 per cent and changes inearnings levels for 20 per cent. In the calculationof a new pension, wages and other income fromemployment are indexed to the level of the first

year of pension using a wage coefficient. In thiscoefficient the figures are the other way round:changes in price level account for 20 per centand changes in wage and salary level for 80 percent. The employment pension index is used torevise current pensions. From 2005 the wage co-efficient will be used to revise earnings duringwage employment, entrepreneurial income andcertain other items specified in employmentpension legislation. Up to 2012, a third index isalso in use in the employment pension systemi.e. the so-called TEL halfway index. This is usedto calculate new pensions in instances where thepension is determined on the basis of rules inforce prior to 2005. In the TEL halfway indexchanges in both prices and earnings levels ac-count for 50 per cent.


7 Calculation examples

7.1 Calculating change in earnings level

Changes in earnings levels are usually indicatedin percentages. For instance, if we want to knowhow much earnings levels have risen amongwage earners from 2002 to 2007, when the in-dex of wage and salary earnings 2000=100 is108.2 in 2002 and 129.2 in 2007, the percent-age change is calculated as follows:

I II

2007 2002

2002

100−

*

129 2 108 2108 2

100 19 4, ,

,* ,

− = %

Nominal earnings have thus gone up by 19.4per cent.

7.2 Calculating change in earnings level by indiceswith two different base years

The indices of wage and salary earnings for indi-vidual industries are only published for the latestbase year. This means there will be situationswhere the only tools available for calculatingearnings trends during a specific period are anindex calculated with the old base year and anindex calculated from the end-point onwardswith the new base year. In this situation it willbe necessary to have some fixed time-point forwhich both the new and old index are available.For instance, if it is known that for base year1995 the index of wage and salary earnings forthe private sector is 107.0 in 1997 and 119.1 in

2000 and the corresponding index for base year2000 is 129.4 in 2007, the change in earningsfrom 1997 to 2007 can be calculated as follows:

(( *I

I

I

I20001995 100

19971995 100

20072000 100

2000200

=

=

=

0 1001 100

=−) ) * or

(,

*,

) * ,1191107

129 4100

1 100 44 0− = %

The increase in earnings from 1997 to 2007is thus 44.0 per cent.

7.3 Changing index base year

If earnings trends are examined repeatedly onthe basis of a certain price agreement, for in-stance, it may be useful to change the indexnumber that is based on an old index to an indexnumber that is based on a new base year. In thisinstance the index numbers based on the new in-dex can be used as they stand and they do notneed to be separately chained to comply withthe original index. Using the index numbersgiven in the example above, the new index forthe baseline point may be calculated as follows:

I

II2000

2000 100

20001995 100 1997

1995 100=

==* eli, or

1001191

107 0 89 84,

* , ,=

Thus the index number for the baseline asmeasured by the new index is 89.8. The devel-opment of earnings can now be calculated di-rectly with index numbers based on the new in-dex:

I

I20002000 100

20001995 100

100=

=* or

129 4 89 8489 84

100 44 0, ,

,* , %

− =

In other words the result is the same as in theprevious example, but the formula employed ismuch simpler.


7.4 Calculating own index

In some cases the services or products offered bya company involve production from two or moreindustries. Let us assume, for instance, that 75per cent of the labour input invested in a metalstructure consists of metal products manufactur-ing and 25 per cent of house construction andthat the corresponding 2000=100 indices for2007 are 130.7 and 127.4. In this case these in-dices can be weighted together as follows:

w I w I1 1 2 2* *+ eli

0 75 130 7 0 25 127 4 129 9, * , , * , ,+ =

Corresponding indices can be constructed bycombining the indices of wage and salary earn-ings and producer price indices, for instance, al-lowing changes in wages and in the prices of ma-terials used to be combined. In this instance it isimportant to make sure that the indices have thesame base year.


8 Publication of the index of wage and salaryearnings and the index of regular earnings

Until the last quarter of 2008, the index of wageand salary earnings and the index of regularearnings were published separately. After thepublication in May 2009 of the data for the firstquarter of 2009, the index of regular earnings ispublished in connection with the wage and sal-ary earnings index.

The index for the first quarter of the year ispublished at the end of May, with a time lag ofabout two months. The time lag is greatest inthe first quarter because of the large number ofstatistical datasets that are completed in thespring. The index for the second quarter is pub-lished after mid-August. Preliminary data on theindex for the third quarter are published bymid-September, because the Finnish Centre forPensions requires these data for the calculationof employment pension indices. The finalisedthird quarter index is published in mid-October.

The index for the fourth quarter is published inearly February.

The most recent wage and salary earnings in-dices and regular earnings indices are always pre-liminary data. The final indices for each calendaryear are usually published in connection withthe publication of the second quarter for thefollowing year in August.

In addition to the index bulletin, the indexwebsite also includes downloadable tables fordifferent sectors for index base years 2000=100and 2005=100 as well as the general index forbase year 1964=100. Wage and salary earningsindices are published more extensively in thewage statistics report Wages and labour costs(2009). A free PDF publication will be pro-duced of wage and salary earnings indices thatcan be downloaded from the index website. Ahard copy will be available subject to a charge.


TILASTOKESKUSSTATISTIKCENTRALENSTATISTICS FINLAND

KÄSIKIRJOJAHANDBÖCKERHANDBOOKS

Nro 1 Koulutusluokitus 2006Utbildningsklassificering 2006 2007

Nro 4 Toimialaluokitus TOL 2008 2008

Toimialaluokitus TOL 2008 (pdf) 2008

Toimialaluokitus TOL 2008 2009Liite 1 Hakemisto

Näringsgrensindelningen TOL 2008 (pdf) 2009

Toimialaluokitus TOL 2002 2002Näringsgrensindelningen TOL 2002Standard Industrial Classification TOL 2002Liite 2 TiivistelmäBilaga 2 SammandragAnnex 2 Summary

Nro 5 Sektoriluokitus 2000 2000Sektorindelningen 2000Classification of Sectors 2000

Nro 6 Rahoitusvaadeluokitus 1996 1995Classification of financial assets and liabilities 1996

Nro 10 Yhteisöjen tehtäväluokitukset uudistettu painos 1986Julkisyhteisöjen ja voittoa tavoittelemattomienyhteisöjen tehtäväluokituksetUppgiftsklassificeringar för sammanslutningar reviderad upplagaUppgiftsklassificeringar för offentliga sammanslutningaroch icke vinstsyftande sammanslutningarClassifications of the functions of government and revised editionnon-profit institutions serving households

Nro 11 Pääasiallisen toiminnan luokitus 1980Pääasiallisen toimeentulolähteen luokitusKlassificering av befolkningen efterhuvudsaklig verksamhetKlassificering av befolkningen efterhuvudsaklig inkomstkällaClassification of the Population by Type of ActivityClassification of the Population by MainSource of Livelihood

Nro 12 Valtiot ja maat 2004 2004Stater och länder 2004Countries 2004

Nro 14 Ammattiluokitus 2001 2001Pääjulkaisu

Ammattiluokitus 2001 2005Liite 1 Hakemisto, huhtikuu 2005

Ammattiluokitus 2001 2001Yrkesklassificeringen 2001Classification of Occupation 2001Liite 3 TiivistelmäBilaga 3 SammandragAnnex 3 Summary

Nro 16 Rakennusluokitus 1994 1994Byggnadsklassificering 1994Classification of Buildings 1994

Nro 17 Sosioekonomisen aseman luokitus 1989 uudistettu painos 1989Classification of Socio-economic Groups revised edition

Nr 17b Sosioekonomisk indelning 1989 reviderad upplaga 1990

Nro 18 Demografiset ja sosiaaliset perusluokitukset 1983Ikä, sukupuoli, siviilisääty, kieli, kansalaisuus, uskontokuntaDemografiska och sociala grundklassificeringarÅlder, kön, civilstånd, språk, nationalitet, trossamfundDemographic and Social Basic ClassificationsAge, Sex, Marital Status, Language, Nationality, Religion

Nro 20 Suomen ympäristötiedostot 1996

Nro 21 Aineellisten varojen luokitukset 1985Kiinteä pääoma, varastovarat, muut aineelliset varatKlassificeringar av materiella tillgångarFast kapital, lagerkapital, övriga materiella tillgångarClassifications of Tangible AssetsFixed Capital, Inventories, Other Tangible Assets

Nro 22 Ikäluokitukset 1986Ohjeita ikäluokituksen käytöstäÅldersklassificeringarRiktlinjer för användning av åldersklassificeringar

Nro 27 Rikosnimikkeistö 1999BrottsnomenklaturCrime nomenclature

Nro 28 Kunnat ja kuntapohjaiset aluejaot 2009 2009Kommuner och kommunbaserade indelningar 2009Municipalities and Regional Divisions Based onMunicipalities 2009

Nro 30 Tilastokeskuksen ammattieettinen opas 2006

No 30b Guidelines on Professional Ethics 2006

Nro 31 Tuottajahintaindeksit 1990=100 1993Indeksien käyttäjän käsikirjaProducer Price Indices 1990=100Handbook for Indices Users

Nro 32 Maanrakennuskustannusindeksi 1990=100 1993Käyttäjän käsikirja

Nro 33 Ansiotasoindeksi 2005=100 (pdf) 2009Käyttäjän käsikirja

Nr 33b Förtjänstnivåindex 2005=100 (pdf) 2009Användarhandbok

No 33c The Index of Wage and Salary Earnings 2005=100 (pdf) 2009Handbook for users

Nro 34 Tuoteluokitus 1995

Nro 35 Väestölaskenta 2000 2001Käsikirja

Nr 35b Folkräkningen 2000 2001Handbok

No 35c Population Census 2000 2001Handbook

Nro 36 Siviiliasiain nimikkeistö 2002Nomenklatur för civilmålNomenclature of civil cases

Nro 37 Jäteluokitusopas 2005

No 37b Guide to Waste Classification 1999

Nro 38 Vuoden 1950 väestölaskennanotosaineiston käsikirja 1997

Nro 39 Kuluttajahintaindeksi 2005=100 (pdf) uudistettu painos 2008Käyttäjän käsikirja

Nr 39b Konsumentprisindex 2005=100 (pdf) 2008Användarhandbok

No 39c Consumer Price Index 2005=100 (pdf)Handbook for Users 2008

Nro 40 Maankäyttöluokitus 2000MarkanvändningsklassificeringLand Use Classification

Nro 41 Julkisyhteisöjen tehtäväluokitus 2001

Nro 42 Rakennuskustannusindeksi 2000 =100 2001Käyttäjän käsikirjaBuilding Cost Index 2000=100User’s Handbook

Nro 43 Laatua tilastoissa uudistettu painos 2007

No 43b Quality Guidelines for Official Statistics 2002

Nro 44 Yksilöllisen kulutuksen käyttötarkoituksen mukainen luokitus (COICOP) 2002

Nro 45 Use of Registers and Administrative Data Sources for Statistical Purposes 2004

Nro 46 Kulutustutkimus 2006 (pdf) 2009Käyttäjän käsikirja

Tilastokeskus, myyntipalvelu Statistikcentralen, försäljning Statistics Finland, Sales Services ISSN 1797–9439PL 4C PB 4C PO Box 4C = Handbooks00022 TILASTOKESKUS 00022 STATISTIKCENTRALEN FI-00022 STATISTICS FINLAND ISBN 978–952–244–209–3 (pdf)puh. (09) 1734 2011 tfn (09) 1734 2011 Tel. +358 9 1734 2011 faksi (09) 1734 2500 fax (09) 1734 2500 Fax +358 9 1734 [email protected] [email protected] [email protected] www.tilastokeskus.fi www.stat.fi www.stat.fi

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