Category: Archive

Wage growth seen as economic threat

February 16, 2011

By Staff Reporter

By Andrew Bushe

DUBLIN — Wages grew by almost four times the rate of inflation during the year to March, according to figures from the Central Statistics office which show that the average industrial wage has grown to £15,890.

Earnings went up 5.5 percent in the year at a time when inflation was 1.4 percent and the number of hours worked fell by 1.2 percent.

Average management earnings are now £28,211 and clerical salaries have gone up to £17,507.

The figures were released as a survey of the country’s top 400 business leaders showed that 36 regarded wage inflation as the principal threat to the economy over the next 12 months.

The MRBI/Goodbodys poll reveals 32 percent of the business bosses believe maintaining the Partnership 2000 and national wage agreements should be the top priority for the government.

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There has also been a pay warning from the country’s main think-tank, the Economic and Social Research Institute, in its latest quarterly report.

It calls for "belated" recognition by government and employers of the importance of profit-sharing to keep basic wages rising excessively as labor markets tighten.

The report says there is a "gradual loss of competitiveness as Irish wages and salaries rise faster than those in other euro countries."

ESRI senior researcher Terry Baker warned of the dangers of losing export orders and inward investment.

He said that there had not been sufficient profit-sharing with workers at a time when businesses has been doing well.

"I think that is why there had been so much feeling of grievance among members of trade unions that somehow they have missed out over the last two or three years," he said.

There had been a significant increase in living standards for most people in the country as a result of wage increases and falling tax "but there is a real grievance about the distribution.

"Some few groups, relatively small numbers of people, have done very, very much better than the general run of workers," said Baker, who was delivering his last report before retiring after 30 years editing the ESRI commentary.

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