How much of an airline's costs are labor costs?
(Source) Direct Operating Costs


  What percentage of a commercial airline's costs are labor costs?


By labor I believe you mean flight- and cabin-crew, the percentage is roughly 12%.


  Can an airline run a low-cost operation without reducing the wages for crew and pilots, or subjecting them to long shifts?


Yes, but they won't make money. What Low Cost Carriers do is save in everything by making sure each expenditure runs more efficiently, so they can offer cheap tickets, which in turn enables them to fill all the seats.

Examples for saving:


Single-type fleet greatly reduces maintenance cost, which is 15% of an airline's operating costs.
Fuel hedging removes the risk of fuel price hikes, but when oil is cheap, it's offset by having to pay more.