Economy at regional level

Data extracted in March 2025.

Planned article update: September 2026.

Highlights

Among EU regions, Malta had the highest annual increase in GDP in 2023 (up 6.7% in real terms); at the other end of the scale. The westernmost Austrian region of Vorarlberg recorded the largest contraction in activity, down 14.1%.

In 2023, there were 3 regions in the EU that recorded GDP per inhabitant that was more than twice as high as the EU average: the Irish regions of Eastern and Midland (2.45 times as high) and Southern (2.25 times as high), and Luxembourg (2.37 times as high).

Source: Eurostat (nama_10r_2gvagr)

In February 2022, Russia launched a war of aggression against Ukraine, prompting ongoing financial, humanitarian and military support to Ukraine from the EU. In July 2022, the European Central Bank (ECB) raised its key interest rates for the 1st time in 11 years, starting a period of successive interest rate hikes. By late 2022, euro area inflation was in double digits, driven by rising energy costs and supply chain disruptions. However, inflation declined significantly during the 2nd half of 2023, easing economic pressures.

Despite the geopolitical situation and several atypical economic shocks – such as the global financial and economic crisis, the European sovereign debt crisis, Brexit and the COVID-19 pandemic – the EU’s economy grew overall, in real terms, by 24.3% between 2008 and 2023. That said, economic activity increased at a modest pace across the EU in 2023. Gross domestic product (GDP) grew 0.4% in real terms, which was considerably lower than in either of the previous 2 years (following a rebound of 6.4% in 2021 and further growth of 3.5% in 2022). In the aftermath of the COVID-19 pandemic, the attention of policymakers and economists turned to long-term, structural challenges, such as population ageing, climate change, weak productivity growth, the cost-of-living crisis, rising income and wealth inequality, as well as territorial disparities within and among EU countries.

The infographic above shows the EU regions with the highest annual growth rates in 2023. The Mediterranean island region of Malta saw its economic activity rise 6.7% in real terms. There were 4 other regions where GDP increased by at least 5.0%: Severen tsentralen in Bulgaria (up 5.8%), the Spanish island regions of Illes Balears (up 5.7%) and Canarias (up 5.1%), as well as the Danish capital region of Hovedstaden (up 5.0%).

Regional gross domestic product (GDP)

The EU’s GDP at market prices was €17.2 trillion in 2023, equivalent to an average of €38 100 per inhabitant. Behind these aggregated figures for the whole of the EU, the economic performance of individual regions varied considerably; these patterns of development are explored in more detail below.

Largest regional economies in the EU

In 2023, there were 10 NUTS level 2 regions within the EU where GDP was in excess of €250 billion. The capital region of France – Ile-de-France – had, by far, the largest regional economy (€860 billion of GDP), followed by the northern Italian region of Lombardia (€490 billion) and the southern German region of Oberbayern (€350 billion). The other 7 regions within this group all had levels of GDP within the range of €250 billion to €300 billion: Comunidad de Madrid (Spain), Eastern and Midland (Ireland), Rhône-Alpes (France), Cataluña (Spain), Düsseldorf, Stuttgart and Darmstadt (all Germany). These 10 regions with the highest levels of GDP collectively accounted for 21.1% of the EU’s economic output. By comparison, the 137 regions across the EU with the lowest levels of GDP accounted for approximately the same proportion of output (21.0%).

More about the data: measuring the size of an economy

The central measure of national accounts, GDP, summarises the economic position of a country or a region. This well-known balance has traditionally been divided by the total number of inhabitants to create a proxy measure for evaluating overall living standards and/or competitiveness, through the derived indicator of GDP per inhabitant.

While GDP continues to be used for monitoring economic developments, playing an important role in economic decision-making, it is complemented by other indicators to inform policy debates on, for example, social and environmental issues. This is because GDP does not take account of externalities such as environmental sustainability or other issues, like income distribution or social inclusion. These are increasingly seen as important drivers for sustainable development and the overall quality of life.

In order to compensate for price level differences between countries, GDP can be converted using conversion factors known as purchasing power parities (PPPs). The use of PPPs, rather than market exchange rates, results in data being denominated in an artificial common currency unit called a purchasing power standard (PPS). In contrast to euro-based (€) series, a series denominated in PPS tends to have a levelling effect, as countries and regions with very high GDP per inhabitant in euro terms also tend to have relatively high price levels. For example, the cost of living in Luxembourg is generally much higher than the cost of living in Bulgaria.

Regional economic statistics are usually reported in current price (or ‘nominal’) terms; in other words, their current value during the particular reference year in question. To make comparisons over time, it is usually more revealing to use data in constant price (or real) terms, where values are adjusted to take account of price changes; in other words, they have been deflated. During periods of high inflation – such as the recent cost-of-living crisis – a time series presented in current price terms will show faster growth than a series in constant price terms. For example, imagine GDP rose from 1 year to the next from €100.0 billion to €110.0 billion, while inflation was 8.0%. In constant price terms using the prices of the 1st year, GDP in the 2nd year would be €101.85 billion. This results in a growth rate of 1.85% in real terms, compared with a 10.0% growth rate in nominal (or current price) terms.

In 2023, the Eastern and Midland region of Ireland had a level of GDP per inhabitant that was 2.5 times as high as the EU average

In 2023, the highest levels of GDP per inhabitant in PPS were located in:

isolated regions, including most of the capital regions of EU countries and several other regions located in Ireland, Spain and France
a band of regions running from the Nordic EU countries, down through Germany and the Benelux countries into Austria and northern Italy.

Map 1 is based on regional GDP per inhabitant (adjusted for purchasing power and then shown as an index based on a percentage of the EU average). The regional distribution of GDP per inhabitant was relatively skewed insofar as fewer than 40% of NUTS level 2 regions – or 92 out of 244 regions for which data are available – reported a level of GDP per inhabitant in 2023 that was equal to or above the EU average (as shown by the teal shades in Map 1).

In 2023, there were 16 NUTS level 2 regions across the EU where GDP per inhabitant was at least 50% above the EU average – as shown by the darkest shade of teal in Map 1. Among these relatively ‘wealthy’ regions, Eastern and Midland – the Irish capital region – had the highest level of regional GDP per inhabitant, with a ratio that was 2.5 times as high as the EU average. There were 2 other regions with ratios that were more than 2.0 times as high as the EU average: Luxembourg (2.4) and the Irish region of Southern (2.3). The remainder of this group of 16 regions with relatively high levels of GDP per inhabitant included:

9 capital regions, namely those of Czechia, Belgium, Romania, the Netherlands, Denmark, Hungary, France, Poland and Sweden
the German regions of Hamburg and Oberbayern
the northern Italian region of Provincia Autonoma di Bolzano/Bozen
the Dutch region of Utrecht.

In the vast majority of EU countries, the capital region had the highest level of GDP per inhabitant in 2023. The 3 exceptions were:

Germany, where Hamburg, Oberbayern, Darmstadt, Stuttgart, Bremen, Mittelfranken, Karlsruhe and Braunschweig recorded higher levels than the capital region of Berlin, while Tübingen and Oberpfalz had the same level
Italy, where Provincia Autonoma di Bolzano/Bozen, Lombardia, Valle d’Aosta/Vallée d’Aoste, Provincia Autonoma di Trento and Emilia-Romagna recorded higher levels than the capital region of Lazio
Austria, where Salzburg recorded a higher level than the capital region of Wien.

More about the data: comparing GDP per inhabitant across EU regions

Some of the economic differences between regions may reflect the (sometimes artificial) administrative boundaries that are used to delineate regions. It is often the case that part of the income generated in ‘wealthy‘ regions may be attributed to labour input from commuters who live in surrounding regions where, among other possible advantages, housing and other costs may be lower.

In addition, some regions with high levels of GDP are characterised by a strong presence of multinational enterprises. This may distort their levels of economic activity, especially if assets (for example, technology patents) are domiciled in a region. For example, the Southern region of Ireland hosts several of the world’s top technology and pharmaceutical businesses.

Map 1 also highlights that many of the regions with relatively low levels of GDP per inhabitant are concentrated in the south-east corner of Europe or outermost regions of the EU. In 2023, 11 NUTS level 2 regions across the EU recorded GDP per inhabitant that was less than 50% of the EU average; they are shown by the darkest shade of gold. Bulgaria and Greece each had 3 such regions, while France and Hungary each had 2, and Romania had a single region. The French outermost region of Mayotte reported the lowest level of regional GDP per inhabitant, at 28% of the EU average. The next lowest ratios were in the Bulgarian regions of Yuzhen tsentralen (41%) and Severozapaden (42%), another French outermost region, Guyane (42%), and the Greek region of Voreio Aigaio (also 42%).

Map 1: GDP per inhabitant
Source: Eurostat (nama_10r_2gdp) and (nama_10_pc)

Dublin had the highest level of GDP per inhabitant in 2023, at 139 500 PPS …

Map 2 provides a similar analysis of GDP per inhabitant in PPS, based on more detailed NUTS level 3 regions. The increased detail/granularity of the data allows a finer analysis of economic disparities, for example, identifying how seemingly ‘wealthier’ cities differ from their surrounding areas.

Many of the regions with high levels of GDP per inhabitant in 2023 are characterised by advanced economic development, serving as important economic hubs, where innovation thrives, and wealth is concentrated.

The Irish regions of Dublin (139 500 PPS) and South-West (137 300 PPS) recorded the highest levels of GDP per inhabitant among NUTS level 3 regions in the EU; both regions are home to numerous multinational enterprises in sectors such as information technology, pharmaceuticals and medical devices.
The German regions of Wolfsburg, Kreisfreie Stadt (136 500 PPS) and Ingolstadt, Kreisfreie Stadt (128 600 PPS) had the next highest levels of GDP per inhabitant (2022 data); both of these regions are major hubs for the motor vehicle manufacturing.
Paris in France (126 900 PPS) and München, Landkreis in Germany (119 500 PPS; 2022 data) were the only other NUTS level 3 regions in the EU to report levels of GDP per inhabitant that were more than 3.0 times as high as the EU average.

… while the French outermost region of Mayotte had the lowest level, at 10 500 PPS

At the opposite end of the spectrum, the NUTS level 3 regions with the lowest levels of GDP per inhabitant were primarily rural areas, less economically developed compared with major urban centres. In 2023, most of the regions with the lowest levels of GDP per inhabitant were located across Bulgaria, Greece (2022 data) and Romania. However, there were also single regions from France, Hungary and Poland where economic activity fell below the level of 15 000 PPS per inhabitant (as shown by a yellow shade in Map 2).

The French outermost region of Mayotte recorded the lowest level of GDP per inhabitant, at 10 500 PPS.
The Bulgarian regions of Sliven, Silistra and Haskovo – characterised by limited investment, a focus on traditional agricultural or industrial sectors, and a peripheral location – reported levels of GDP per inhabitant ranging from 11 000 PPS to 11 400 PPS.

Map 2: GDP per inhabitant
Source: Eurostat (nama_10r_3gdp)

In 2023, Champagne-Ardenne in France was the most specialised region in the EU for agriculture, forestry and fisheries

Agriculture, forestry and fisheries play a crucial role in many rural regions of the EU. These regions leverage abundant natural resources to shape their local economies, preserve cultural traditions, and support both economic and environmental sustainability. For example:

Toscana and Puglia in Italy are renowned for their olive oil production
Normandie and Bretagne in France are known for their dairy/livestock farming
several regions across the Baltic and Nordic EU countries are specialised in forestry
Galicia and Principado de Asturias in north-western Spain are among the most important fishing regions in the EU.

In 2023, agriculture, forestry and fisheries contributed 1.8% to the EU’s total gross value added. Figure 1 shows the relative share of these sectors in the total economic activity of NUTS level 2 regions. There were 6 regions within the EU where agriculture, forestry and fisheries accounted for more than a tenth of total gross value added.

Champagne-Ardenne in France (12.7%; 2022 data) had the highest share, followed by the Portuguese region of Alentejo (12.2%) and the Croatian region of Panonska Hrvatska (11.4%).
The Greek regions of Thessalia and Peloponnisos, and Mazowiecki regionalny In Poland (which surrounds the Polish capital; 2022 data) were the only other EU regions where agriculture, forestry and fisheries contributed a double-digit share to overall economic activity.

Variations in the share of agriculture, forestry and fisheries in total gross value added reflect a range of factors, including geography, history, culture, economic diversification and government policies. Some regions are naturally predisposed for agriculture, such as those with rolling plains or fertile soils. By contrast, mountainous or arid regions often lack the necessary conditions for extensive farming, while densely populated regions tend to have seen their agricultural land repurposed for housing, commercial use or infrastructure. The largest inter-regional differences were observed in:

France (2022 data), with a 12.6 percentage point gap, as Champagne-Ardenne (12.7%) had the highest share, while the capital region of Ile-de-France (0.1%) had the lowest
Portugal, with a difference of 12.0 points, with Alentejo (12.2%) recording the highest share and the capital region of Grande Lisboa (0.2%) the lowest.

Figure 1: Regional specialisation in agriculture, forestry and fisheries
Source: Eurostat (nama_10r_3gva) and (nama_10_a10)

Income

Having analysed GDP from the output side, this section focuses on income. Information is presented for primary income (from paid work and self-employment, as well as from interest, dividends and rents) and for disposable income.

Household primary income relative to GDP

More about the data: analysing regional statistics for net primary income

Within regional accounts, GDP is recorded where it is generated (a person’s place of work), whereas income is recorded at their place of residence (where people live). As a result, the ratio of net primary income to GDP is generally lower in regions that concentrate economic activity, such as capital regions and other major urban/metropolitan centres, and higher in regions where inter-regional commuters – people who work and live in 2 different regions – live.

Furthermore, the kind of economic activity that takes place in a region affects the relationship between net primary income and GDP. For regions specialised in capital (tangible or intangible) intensive activities, the remuneration of workers will generally constitute a lower share of the value added than in regions that are specialised in more labour intensive activities.

Regional statistics on primary income are available for all the vast majority of NUTS level 2 regions in the EU; the only exceptions are Utrecht and Zuid-Holland (both in the Netherlands).

Primary income includes earnings from wages/salaries and self-employment, as well as income from investments like interest, dividends and rents; it reflects household income before taxes and transfers. In 2022, EU households received a total of €10.2 trillion of primary income, while the EU’s GDP was €16.1 trillion. As such, average household primary income was 63.1% of GDP. This ratio was somewhat skewed, insofar as 89 out of 244 NUTS level 2 regions for which data are available had a ratio that was lower than the EU average.

In capital regions, the impact of commuting often results in relatively low ratios of household primary income to GDP

Across the EU, there were 16 NUTS level 2 regions where household primary income accounted for less than 50.0% of GDP (as shown by a yellow shade in Map 3).

A majority of these regions were capital regions, including those of Belgium, Czechia, Denmark, Ireland, Croatia, Hungary, Poland, Portugal and Slovakia.
Other regions in this group included Övre Norrland (Sweden), Sud-Vest Oltenia (Romania), Hamburg (Germany), Groningen (the Netherlands), Yugoiztochen (Bulgaria), Luxembourg and Southern (Ireland).

The lowest ratio of primary income relative to GDP among NUTS level 2 regions was recorded in the Southern region of Ireland (at 26.6% in 2022). The low value likely reflects Southern being the European headquarters for several multinational enterprises in sectors such as information technology and pharmaceuticals. The low ratios recorded in other regions reflect, at least to some degree, a commuting impact.

Many people live outside capital regions but work within them, meaning that GDP is generated in the capital region, while income is accounted for in neighbouring regions. For example, the regional economy of the Czech capital region of Praha benefits from inflows of commuters from the surrounding region of Střední Čechy.
In a similar vein, the relatively high level of GDP per inhabitant in Luxembourg may, at least in part, be attributed to the impact of cross-border commuters from the neighbouring regions of Prov. Luxembourg (Belgium), Trier (Germany) and Lorraine (France).

In 2022, the highest ratios of household primary income to GDP were recorded in the Belgian region of Prov. Luxembourg and the German region of Trier; a relatively high share of their resident populations are employed in Luxembourg

At the other end of the range, there were 16 NUTS level 2 regions where the ratio of household primary income relative to GDP was equal to or above 80.0% in 2022 (as shown by the darkest shade of blue in Map 3).

The highest ratio was recorded in the Belgian region of Prov. Luxembourg (at 94.2%), followed closely by the German region of Trier (94.0%); as noted above, this reflects many residents working in neighbouring Luxembourg, while their income is recorded in their home region.
There were 3 other regions that had ratios higher than 90.0%:
- the German region of Lüneburg (93.0%), where many residents worked in Hamburg
- the Portuguese region of Península de Setúbal (92.7%), where many residents worked in Grande Lisboa.
the Greek region of Ionia Nisia (92.1%), where a relatively high share of income comes from remittances sent by emigrants abroad and/or pensions received from other EU countries.

Map 3: Household primary income relative to GDP
Source: Eurostat (nama_10r_2hhinc) and (nama_10r_2gdp)

Net primary income per inhabitant

As noted above, economic hubs across the EU drive wealth creation, with part of their generated output attributed to commuters who live in surrounding regions. As a result, income per inhabitant in these surrounding regions tends to be relatively high when contrasted with their economic output (as measured by GDP per inhabitant).

In 2022, EU primary income per inhabitant averaged 22 700 PPS. The use of data in PPS, rather than in euro (€), takes account of price level differences between countries; the conversion to PPS takes into account the fact that household expenditure is predominantly related to consumption.

4 German regions – Oberbayern, Hamburg, Stuttgart and Darmstadt – and Utrecht in the Netherlands had the highest levels of net primary income per inhabitant in 2022

There were 26 NUTS level 2 regions with a ratio of net primary income per inhabitant of at least 30 000 PPS in 2022.

These regions were primarily located in Germany (15 regions), with some of the highest levels of net primary income per inhabitant recorded in Oberbayern (42 100 PPS), Hamburg (35 400 PPS), Stuttgart (34 600 PPS) and Darmstadt (34 100 PPS).
The Dutch region of Utrecht (36 900 PPS) and Luxembourg (33 400 PPS) had the highest levels of net primary income per inhabitant outside of Germany.
Apart from Luxembourg, there were 4 capital regions within this group of 26: Ile-de-France (where net primary income per inhabitant averaged 32 900 PPS), Noord-Holland (32 200 PPS), Bucureşti-Ilfov (30 900 PPS) and Stockholm (30 100 PPS).

It is worth noting that, in euro terms, Luxembourg had the highest level of net primary income per inhabitant (€45 700). This figure was slightly above the €45 600 per inhabitant recorded for Oberbayern, while the Danish capital region of Hovedstaden had the 3rd highest ratio (€41 900 per inhabitant). The relatively high cost of living in both Luxembourg and Hovedstaden meant that they ranked 6th and 41st, respectively, when based on data in PPS terms (that compensate for price level differences).

The results above focus on absolute levels of primary income. To have a further insight into income distribution, Map 4 expresses income levels as indices relative to national averages, thereby highlighting regional disparities in income distributions. The results for 2022 were skewed insofar as across the EU there were:

77 regions that had indices above their national average
6 regions that had indices equal to their national average
161 regions that had indices below their national average.

The regions with the highest indices in 2022 and therefore a high concentration of net primary income per inhabitant were generally capital regions and/or economic hubs. This pattern was particularly pronounced in eastern and southern EU countries, for example, net primary income per inhabitant was:

2.3 times as high as the Romanian average in Bucureşti-Ilfov
1.7 times as high as the Slovakian average in Bratislavský kraj
1.6 times as high as the Hungarian and the Bulgarian averages in Budapest and Yugozapaden
1.5 times as high as the Italian average in Provincia Autonoma di Bolzano/Bozen.

There were 23 NUTS level 2 regions where the ratio of net primary income per inhabitant was at least 20.0% above the national average in 2022 (they are shown with a dark teal shade in Map 4). They included:

14 capital regions, with Ile-de-France (France), Sostinės regionas (Lithuania), Stockholm (Sweden) and Helsinki-Uusimaa (Finland) the only capital regions from outside of eastern or southern EU countries
3 regions in northern Italy – Provincia Autonoma di Bolzano/Bozen, Lombardia and Emilia-Romagna – all of which recorded higher net primary income per inhabitant than the capital region of Lazio
Oberbayern in southern Germany, which had a higher level of net primary income per inhabitant than the capital region of Berlin
Utrecht in the Netherlands, which had a higher level of net primary income per inhabitant than the capital region of Noord-Holland
País Vasco in Spain, which had a relatively high concentration of net primary income per inhabitant, though below that recorded in the capital region of Comunidad de Madrid
Prov. Vlaams-Brabant in northern Belgium, which had a higher level of net primary income per inhabitant than the capital region of Région de Bruxelles-Capitale / Brussels Hoofdstedelijk Gewest
the Greek regions of Notio Aigaio and Ionia Nisia, which had relatively high concentrations of net primary income per inhabitant, though below that recorded in the capital region of Attiki.

As outlined above, there were approximately twice as many regions (161 out of 244 for which data are available across the EU) that recorded net primary income per inhabitant below (rather than above) their national average in 2022. This may be linked, among others, to factors such as geography, demographic patterns, the distribution of education and skills, economic diversification/concentration or regional patterns of innovation and investment.

At the bottom end of the distribution, there were 20 NUTS level 2 regions across the EU where net primary income per inhabitant in 2022 was less than 75.0% of the national average (as shown by the darkest shade of gold in Map 4). This group of 20 regions was composed of:

5 regions from southern Italy, with the lowest index recorded in Calabria
4 regions from Bulgaria, with the lowest index recorded in Severozapaden
4 outermost regions from France, with the lowest index – both in France and across the whole of the EU – recorded in Mayotte
3 regions from Romania, with the lowest index recorded in Nord-Est
2 regions from eastern Germany, with the lowest indices recorded in Chemnitz and Sachsen-Anhalt
single regions from Spain (Extremadura) and Hungary (Észak-Magyarország).

Among this group of 20 regions, the highest levels of net primary income per inhabitant in 2022 were recorded in the 2 German regions of Chemnitz and Sachsen-Anhalt (both 22 000 PPS). While their income levels were slightly below the EU average (22 700 PPS), they were nevertheless considerably higher than for any other region within this group. The next highest income levels were recorded in the French outermost regions of Guadeloupe (16 400 PPS) and La Réunion (16 100 PPS). At the lower end of the distribution, 8 out of this group of 20 had levels of net primary income per inhabitant that were below 10 000 PPS. Severoiztochen in Bulgaria was the only other region in the EU – outside of this group of 20 – to record a level of income below this level.

Map 4: Net primary income per inhabitant
Source: Eurostat (nama_10r_2hhinc)

Table 1 shows the annual change in household primary income and the compensation of employees for 2022. These rates of change provide an opportunity to understand the dynamics of income distribution, the health of the labour market and shifts in the sources of household income. If the annual change in household primary income is rising faster, this suggests that income from non-labour sources (for example, investments or social transfers) is growing more rapidly than the compensation of employees, which may be an indication of rising inequalities and/or a shift in how households are earning their income. Conversely, if the compensation of employees grows at a faster rate than household primary income, this suggests that wages are driving income growth in households.

In 2022, the highest growth rate for household primary income was in the Bulgarian capital region of Yugozapaden, up 21.0% ...

In 2022, household primary income across the EU increased 8.0%, while the compensation of employees was 6.2% higher; these values are in current price terms and therefore do not take into account price changes during the period under consideration. Across NUTS level 2 regions, the Bulgarian capital region of Yugozapaden recorded the highest growth rate for household primary income (up 21.0%), followed by the Czech region of Střední Čechy (up 20.1%) that encircles the capital region of Praha. Household primary income also rose at a rapid pace in:

several tourism-dependent regions – such as Illes Balears (Spain) and Algarve (Portugal) – which had experienced a low level of economic activity during 2021 due to the COVID-19 crisis
several capital regions – for example, Bucureşti-Ilfov (Romania), Sostinės regionas (Lithuania) and Budapest (Hungary)
a number of regions that encircle capital regions – for example, Mazowiecki regionalny (Poland) and Pest (Hungary)
the remaining regions of Czechia, as the slowest rate of change was recorded in the capital region of Praha (where household primary income nevertheless grew by 13.0%).

… while the Lithuanian region of Vidurio ir vakarų Lietuvos regionas had the highest growth rate for employee compensation, up 17.9%

Employee compensation is defined (within national accounts) as remuneration, in cash or in kind (such as a company car or vouchers for meals), payable by an employer to an employee in return for work done; it also includes payments linked to social contributions (such as health or pension contributions). Most EU regions with high annual growth rates for household primary income also had relatively high growth rates for the compensation of employees. In 2022, there were 8 NUTS level 2 regions in the EU where the compensation of employees increased by at least 15.0%. They included:

Vidurio ir vakarų Lietuvos regionas in Lithuania, which had the highest growth rate (up 17.9%)
Nord-Vest and Bucureşti-Ilfov in Romania
Yugozapaden and Severozapaden in Bulgaria
the tourism-focused regions of Jadranska Hrvatska (Croatia), Illes Balears and Algarve.

Among NUTS level 2 regions, the autonomous Finnish archipelago of Åland was the only region in the EU to experience a decline in household primary income in 2022 (down 4.3%). Åland also recorded the lowest regional rate of change for the compensation of employees (down 1.3%). The northern Swedish region of Mellersta Norrland was the only other EU region to record a negative change, albeit modest, with the compensation of employees down 0.1%.

Table 1: Household primary income and compensation of employees
Source: Eurostat (nama_10r_2hhinc)

Productivity and investment indicators

This final section provides further information about the compensation of employees (detailing the level of remuneration per hour worked), alongside information on labour productivity (defined here as gross value added per person employed); these indicators may be used to analyse patterns/developments of regional competitiveness.

Compensation of employees

One of the principal areas of interest/concern for many employees is their level of remuneration; this has become an even greater preoccupation during the cost-of-living crisis. The data presented in Table 2 refer to gross (in other words, before tax) hourly compensation in euro (€).

Luxembourg had the highest level of employee compensation, €55.0 per hour in 2022

In 2022, an employee working in the EU received, on average, gross compensation of €26.6 for every hour that they worked. Luxembourg had the highest level of compensation across NUTS level 2 regions in the EU, at €55.0 per hour. At the other end of the distribution, the Romanian region of Nord-Est had the lowest level of compensation (€6.2 per hour). As such, the ratio between the highest and lowest levels of employee compensation was 8.9 : 1. The distribution of employee compensation was symmetrically centred on the EU average, insofar as 122 regions had values that were higher than the mean, while 121 regions had values that were below; there was 1 region that had the same level of employee compensation – the Spanish capital region of Comunidad de Madrid.

At the top end of the distribution, there were 26 NUTS level 2 regions in the EU where the average level of employee compensation was at least €40.0 per hour in 2022. These regions were principally concentrated in Belgium (8 regions), Germany (also 8 regions), Denmark (all 5 regions), the Netherlands (3 regions) and also included Luxembourg, as well as the capital region of Ile-de-France (France).

There were 41 NUTS level 2 regions where employee compensation was less than €10.0 per hour worked in 2022. They were predominantly located across eastern EU countries and included:

16 of the 17 regions from Poland, the exception being the capital region of Warszawski stołeczny
7 of the 8 regions from each of Hungary and in Romania, the exceptions being the capital regions of Budapest and Bucureşti-Ilfov
5 of the 6 regions from Bulgaria, the exception being the capital region of Yugozapaden
Panonska Hrvatska and Sjeverna Hrvatska that are both located in Croatia
the only exceptions – from outside of eastern EU countries – were 4 Greek regions, namely, Voreio Aigaio, Ipeiros, Notio Aigaio and Kriti.

In 2022, the only multi-regional EU countries where capital regions did not have the highest level of employee compensation were Germany, Greece, Spain and Italy

Table 2 confirms that the highest regional levels of employee compensation were usually recorded in capital regions. This pattern was repeated in 18 of the 22 multi-regional EU countries. This is unsurprising given the high cost of living in many capitals, while most also play an important role as the location for company headquarters, financial services and national administrations, which tend to offer above average levels of compensation. The only exceptions, where the highest level of employee compensation was not recorded in the capital region, were:

Oberbayern in Germany (€46.2 per hour)
Dytiki Makedonia in Greece (€13.0 per hour)
País Vasco in Spain (€27.0 per hour)
Provincia Autonoma di Bolzano/Bozen in Italy (€30.4 per hour).

Several EU countries had regional distributions of employee compensation that were heavily skewed. This was generally because the capital region had a much higher level of compensation than other regions of the same country. For example:

someone working in the Romanian capital region of Bucureşti-Ilfov (€13.6 per hour) could expect to earn more than twice as much as an someone working in Nord-Est (€6.2 per hour), where the lowest level of compensation in Romania was recorded
someone working in the Polish capital region of Warszawski stołeczny (€14.2 per hour) could expect to earn more than twice as much as an someone working in Warmińsko-mazurskie (€6.6 per hour), where the lowest level of compensation in Poland was recorded.

Table 2: Compensation of employees
Source: Eurostat (nama_10r_2lp10) and (nama_10_lp_ulc)

Real labour productivity

More about the data: analysing regional statistics for labour productivity

Labour productivity can be defined as GDP (or gross value added) divided by a measure of labour input, typically the number of people employed or the total number of hours worked. The information presented in Map 5 is based on labour productivity per hour worked, which should not be influenced by changes in the structure of the employment market. For instance, the ratio is not impacted if there is a shift from full-time to part-time work, or if working hours are curtailed (for example, due to labour market restrictions such as those imposed during the COVID-19 crisis).

High labour productivity may be linked to the efficient use of labour and/or reflect the skills and experience of the labour force. These in turn may result from the specific mix of activities present in each regional economy as some activities, for example, knowledge-intensive industrial activities, business or financial services tend to be characterised by higher levels of labour productivity (as well as higher levels of employee compensation).

In 2022, people working in the EU generated an average of €46.7 in value for each hour worked. This figure, when based on GDP per hour worked in 2015 prices, can be used to create indices which measure real productivity improvements adjusted for inflation; these indices are presented relative to the EU average, set at 100.0.

Map 5 shows the development of labour productivity across NUTS level 2 regions compared with the EU average from 2015 to 2022. If the value for a region exceeds 100.0 then that region’s productivity growth outpaced the EU average during the period under consideration; if a region’s value is below 100.0, then that region’s productivity growth lagged behind the EU average. As such, the information shown highlights changes in labour productivity over time (relative to the EU average); the map does not compare absolute levels of labour productivity. Regions with an above average rate of change either closed the productivity gap with the EU average or widened their advantage, while regions with a lower than average rate of change either fell further behind the EU average or saw their productivity advantage narrow.

Real changes in labour productivity were evenly distributed, insofar as 112 (out of 225) NUTS level 2 regions had indices that were above the EU average in 2022, the same number of regions that had indices that were below the EU average; in the Italian region of Provincia Autonoma di Bolzano/Bozen, labour productivity grew at the same pace as the EU average. There were 22 NUTS level 2 regions where real labour productivity grew at least 15% faster than the EU average between 2015 and 2022 (as shown by the darkest shade of teal in Map 5). They were predominantly located in eastern EU countries with the highest counts in Poland (6 regions), Bulgaria (4 regions) and Romania (3 regions), while there were also single regions from each of Croatia and Hungary. The remainder of this group was composed of all 3 regions from Ireland, 2 regions from France, the capital region of Lithuania, as well as Estonia.

Between 2015 and 2022, 14 NUTS level 2 regions across the EU experienced a decline in real labour productivity or recorded growth that was at least 10% slower than the EU average (as indicated by the darkest shade of gold in Map 5). This group of 14 regions included:

6 regions from Greece
6 regions from France, 4 of which were outermost regions, together with Auvergne and Languedoc-Roussillon
2 regions from Romania, Sud-Muntenia and Sud-Vest Oltenia.

Map 5: Development of real labour productivity
Source: Eurostat (nama_10r_2rlp), (nama_10_gdp) and (nama_10_a10_e)

Source data for figures and maps

Regional economic statistics

Data sources

European system of national and regional accounts

The European system of national and regional accounts (ESA 2010) is the latest internationally compatible accounting framework for a systematic and detailed description of the EU economy. ESA 2010 has been implemented since September 2014 and is consistent with worldwide guidelines on national accounting, as set out in the system of national accounts (2008 SNA).

ESA 2010 provides a framework for consistent, comparable, reliable and up-to-date economic statistics for EU countries. The legal basis for these statistics is Regulation (EU) No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European system of national and regional accounts in the European Union. ESA 2010 is not restricted to annual national accounting, as it also applies to regional accounts and to quarterly and shorter period accounts. It is harmonised with the concepts and classifications used in many other social and economic statistics (for example, statistics on employment, business or international trade) and as such serves as a central reference for socioeconomic statistics.

Regional data

Statistics from regional economic accounts are presented here for NUTS level 2 and NUTS level 3 regions (the more detailed/granular information is available for GDP, gross value added at basic prices and employment). The data for statistical regions in the EFTA and candidate countries are sometimes unavailable and have been replaced (where appropriate) by national aggregates. Data for non-EU countries are sometimes only available for earlier reference periods when compared with those presented for EU regions; all discrepancies are footnoted under maps and figures.

Indicator definitions

Gross domestic product and value added: gross domestic product (GDP) is a basic measure of the overall size of an economy. As an aggregate measure of production, GDP is equal to the sum of the gross value added of all resident institutional units engaged in production, plus any taxes on products and minus any subsidies on products.

Income: the distribution and redistribution of income results in balancing items, namely primary income and disposable income. In regional accounts, these income measures are limited to households. Primary income concerns 2 types of income:

primary incomes receivable by virtue of direct participation in the production process, mainly operating surplus and mixed income, and the compensation of employees
property incomes receivable by the owner of a financial asset or a tangible non-produced asset in return for providing funds to, or putting the tangible non-produced asset at the disposal of, another institutional unit (interest, dividends, withdrawals from income of quasi-corporations, reinvested earnings of foreign direct investment, rents on land).

Compensation of employees and labour productivity: in national accounts, the compensation of employees is defined as the total remuneration, in cash or in kind, payable by an employer to an employee in return for work done by the latter during an accounting period. It consists of wages and salaries in cash or in kind and employer’s actual and imputed social contributions.

Labour productivity reflects the (average) amount of goods and services produced relative to a measure of labour input. It can be measured in a variety of ways. For example, GDP (in terms of purchasing power standards) relative to the number of employed people or relative to the total number of hours worked. In both cases, the resulting ratio for a country or a region can subsequently be expressed as an index (relative to the EU or national average).

Context

With the arrival of a new European Commission, 7 priorities for 2024 to 2029 were identified, including 3 with a direct impact on the economy:

In December 2020, the multiannual financial framework covering the period 2021 to 2027 was adopted. This provided resources to kick-start the European economy, through boosting the green and digital transitions, and making it fairer, more resilient and more sustainable for future generations. An emergency European Recovery Instrument (also known as Next Generation EU) reinforced the framework, providing a plan designed to ensure the EU could emerge stronger from the COVID-19 crisis. The plan seeks to transform economies and societies so they work for everyone, setting a blueprint for a new growth model based on a clean, innovative and inclusive economy and digital and tech sovereignty.

The framework for EU cohesion policy dates back to 1986 and the Single European Act. This sought to enhance regional policies by ensuring balanced development, as well as social, economic and territorial cohesion. The intent of regional policies is not the transfer of economic wealth from relatively affluent to less affluent regions, but support for programmes that aim to resolve regional issues. Cohesion policy is an active form of solidarity that includes measures designed – through strategic investment – to boost economic growth, jobs, the quality of life, as well as green and digital transitions. It plays a role in 5 key areas:

a smarter Europe – for example, through innovation and digitisation, economic transformation and support for SMEs
a greener, low carbon transition to zero carbon economy – investing in energy transition, renewables and the fight against climate change, and providing support to those territories most affected by the socioeconomic impact of the transition to climate neutrality
a better connected Europe – enhancing mobility and highlighting strategic transport and digital networks, for example, investing in the digital transition to expand very-high-speed internet access, boost digital skills, and investing in information technology equipment
a more social and inclusive Europe – supporting quality employment, education, skills, social inclusion and equal access to healthcare
a Europe closer to its citizens – promoting locally led development, by fostering sustainable and integrated development across all types of territories.

To reach these goals, the EU has set aside €392 billion for economic, social and territorial cohesion during the period 2021 to 2027. This support is principally delivered through 4 key instruments, namely the European Regional Development Fund, the European Social Fund+, the Cohesion Fund and the Just Transition Fund.

Regional accounts are important in this context, as they are used, among other purposes, to decide upon the regional allocation of cohesion policy expenditure. As of 2021, the rules for allocating funding became simpler: they were tailored to locally led development strategies that continue to take account of GDP per inhabitant, alongside information on the socioeconomic and environmental situation (for example, youth unemployment rates, low levels of educational attainment, the reception and integration of migrants, or climate change).

This article forms part of Eurostat’s annual flagship publication, the Eurostat regional yearbook.

You can explore the maps interactively using Eurostat’s Statistical Atlas.

Explore further

Database

Regional statistics by NUTS classification (reg), see

Regional economic accounts (reg_eco10)

Gross domestic product indicators (reg_eco10gdp)

Branch and household accounts (reg_eco10brch)

Annual national accounts (nama10), see

GDP and components (nama_10_ma)

Population and employment in national accounts (nama_10_e_p)

Regional economic accounts (nama_10reg)

Gross domestic product indicators (nama_10r_gdp)

Branch and household accounts (nama_10r_brch)

Labour and capital productivity (nama_10_prod)

Thematic section

Publications

General link

Latest news articles, statistical publications and statistical working papers for national accounts (including GDP)

Paper and PDF publications

European system of accounts – ESA 2010
Eurostat regional yearbook – 2025 edition

Online publications

Selected datasets

Regional statistics (t_reg), see

Regional economic accounts – ESA 2010 (t_reg_eco)

Annual national accounts (t_nama10), see

Regional economic accounts – ESA2010 (t_nama_10reg)

Methodology

Manuals and further methodological information

Metadata

Regional economic accounts (ESMS metadata file – reg_eco10_esms)

External links

European Commission – Directorate Generals

European Commission – resources

Visualisation