Wages (Pay as you earn)
17. Feb 2025
DKK 12.8 billion in wages in the past 12months — up 5% year-on-year
Wage expenditures rose by DKK 593 million (4.9%) in the February 2024-January 2025 period compared with the previous 12-month period.
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The trend reveals steady growth in wage expenditures in recent years; however, this growth has slowed down in the past year.
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Women lead wage growth
Women have seen steadier wage growth than men in recent years. Men's wage growth was significantly affected by the COVID-19 pandemic. In the past 12 months, women accounted for 38.9% of total wages, which is a year-on-year increase of 1%.
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Of the total wage growth of almost DKK 600 million, women accounted for DKK 370 million (60%). Of this amount, women working for employers under public control accounted for DKK 328 million.
Women’s total wages rose by 8% year-on-year, compared with 3% for men. For women and men working for employers under public control, the growth was 11% and 6%, respectively.
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Falling wages in pelagic fisheries
The table below shows the A-taxable (taxed at source) wages at the first level of the NACE 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.
‘Agriculture, forestry and fishing’ and ‘Manufacturing’ were the only industry branches that saw lower year-on-year wage expenditures in the past year. Within ‘Agriculture, forestry and fishing’, the biggest drop in money terms was ‘Pelagic fisheries’, where wages fell by DKK 110 million (17%) year-on-year.
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Biggest wage growth in Sandoy region
Below is a breakdown of wages by region in the past 12 months compared with the previous 12-month period. Sandoy saw the highest growth at 8%, while Suðuroy had the lowest growth at 2.3%.
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
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Women’s average wage 28% below men’s
The average wage per person was DKK 33,633 in January, 5.6% percent higher than in January 2024. The graph below shows the average wage by sex. In January, women’s average wage was DKK 28,000, 28% lower than the DKK 38,900 average for men. Compared with January 2024, the average wage grew by more than 5% for men and by 6% for women. Note that working hours are not considered when calculating the average salary. The average salary is calculated by dividing the total wage by the number of persons receiving wages.
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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.