Wages (Pay as you earn)
13. Jan 2025
DKK 12.7 billion in wages in 2024 — up 5% year-on-year
Wage expenditures rose by more than DKK 600 million (5%) in 2024 compared with 2023.
[px-graph-5]
The trend reveals steady growth in wage expenditures in recent years; however, this growth has slowed down compared with previous years. Wage expenditures in 2023 were 5.8% higher than in 2022. In 2022, wages increased 6.1% year-on-year.
[px-graph-1]
Women drove 60% of wage growth despite earning 40% of wages
Women’s wage growth has been relatively steady in recent years, while men's wage growth was more affected when the pandemic hit. In recent years, men have accounted for about 60% and women 40% of total wages. In 2024, this distribution was 61.1% for men and 38.9% for women. For comparison, women accounted for 37.8% of all wages in 2023.
[px-graph-2]
However, wages increased more for women than for men in the past year. Of the total wage growth of DKK 600 million, women accounted for DKK 370 million. Of this amount, women working for employers under public control accounted for DKK 326 million.
Women’s wages rose by 8% year-on-year, compared with 3% for men.
[px-graph-4]
Biggest wage growth in Sandoy region
Below is a breakdown of wages by region in 2024 and 2023. Sandoy saw the highest growth at 8%, while Suðuroy had the lowest growth at 1.4%.
More detailed wage statistics are available on the following regional pages: Norðoya region, Eysturoyar region, Norðstreymoyar region, Suðurstreymoyar region, Vága region, Sandoyar region, Suðuroyar region
[px-graph-6]
Wages by industry
The table below shows the A-taxable (taxed at source) wages at the first level of the new industry classification in the past 12 months compared with the previous 12-month period. The largest growth in money terms was in ‘Public administration and defence; compulsory social security’, followed by ‘Human health and social work activities’. Within ‘Human health and social work activities’, ‘Residential care activities’ saw particularly high wage growth. Residential care activities include care for residents of institutions and nursing homes.
‘Agriculture, forestry and fishing’ and ‘Manufacturing’ were the only branches that saw lower year-on-year wage expenditures in 2024. Within ‘Agriculture, forestry and fishing’, the biggest drop in money terms was ‘Pelagic fisheries’, where wages fell by DKK 103 million (16.5%) year-on-year.
[px-graph-3]
About the wage statistics
Wages as a statistical concept are part of the broader definition of compensation for employees. Compensation is divided into a) wages and b) employers' contributions to social schemes, including pensions. The terms are based on the description in the national accounting manuals 'System of national accounts' published by the UN and 'European system of accounts' published by Eurostat.
According to this definition, wages include wage components such as basic wages, allowances, overtime pay, holiday pay and employee benefits. Not included are employer social benefits such as pensions, unemployment insurance and maternity benefits.
The wage statistics only include cash wages paid by employers to employees through the PAYE system. The wage statistics thus cover A-taxable wages from employers who are economically active in the Faroe Islands. All wage payments that meet the above requirements are included, regardless of whether the employee resides in the Faroes or abroad.
Revised statistics
Wage statistics were updated and revised in the first half of 2024. These changes have led to a slight increase in total wages, particularly in recent years. The main reason for this increase is the inclusion of employers registered in the Faroese International Shipping Register (FAS), who are now considered part of the Faroese economy. Due to these changes, the latest figures cannot be compared to previous data. Older tables are still accessible in the statbank but will not be updated. These tables are labelled 'Discontinued' in the statbank.