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Flanders: where high productivity meets labor cost reduction

Overall, Flanders boasts an extremely productive workforce, stable labor costs, and various fiscal advantages and wage optimization possibilities for your company. For each foreign direct investment (FDI) project, however, the costs of labor are dependent upon the activity, sector and labor intensity level involved. Get the details below. 

Further reducing labor costs

Changes to taxation laws have resulted in several labor cost reduction initiatives in Flanders. In addition, despite the fact that social security contributions (SSC) in Flanders are high, there are many reductions to SSC rates, fringe benefits and upcoming tax shifts that all serve to greatly reduce employers' tax burdens and simplify the overall tax code.

Even further, estimations of labor cost do not take into account the extremely high productivity level of Flanders' workforce – the 4th highest in the world – flexible labor system and excellent educational infrastructure.

Many reductions of social security contributions

Several employment subsidies serve to even further reduce employers' salary costs in Flanders, including target group reductions applicable to startups and certain categories of employees. The current governmental regime plans to reduce SSC contributions from 33% to 25% by 2018.

Extremely high labor productivity

Many global studies have confirmed that workers in Belgium and Flanders as a region are more productive than those of any neighboring country except Luxembourg. High-level staff in Flanders are comparably low-cost while being extremely effective per hour worked.

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