The Irish Congress of Trade Unions has called for a substantial increase in the hourly rate of the national minimum wage to align it more closely with a living wage – the amount estimated as necessary to cover basic living costs. The minimum wage is currently set at €9.25 an hour, while the living wage has been estimated at €11.50.
In a submission to the Low Pay Commission, Congress said there was widespread support for “aligning the hourly rate of the minimum wage with that of the living wage and called on the commission to “reflect this consensus.”
The commission, which recommends minimum wage improvements to the government, signalled a measly ten cent increase last year. Unions say the commission should take account of the need to protect living standards, not just maintain wage competitiveness.
Congress official Liam Berney said there is strong evidence of upward growth in earnings and profits, while employment is also increasing. “Just 3.5% of the workforce earns the minimum wage, so the impact of any increase in employment costs is minimal. It is a matter of deep concern to Congress that more than 73% of those on the minimum wage are women. So any increase in the rate will also help reduce the gender pay gap,” he said.
Meanwhile, the European Trade Union Confederation launched its ‘Europe needs a pay rise’campaign at a conference in Brussels last week. Its general secretary Luca Visentini said the response to the European economic crisis had been “wage cuts, a general dismantling of collective bargaining, and attacks on minimum wage systems,” which had compounded Europe’s economic and social difficulties.
“A pay rise would boost economic recovery by supporting demand, productivity and competitiveness, and make growth more sustainable and inclusive through more equality and fairer wage share and wealth redistribution,” he said.
The ETUC campaign website highlights a deflationary economic cycle where profits and productivity are rising, but “real wages have barely budged.” It says economists, and even some business leaders, have realised that by strengthening purchasing power, pay rises are an engine of demand, growth and jobs.
By Niall Shanahan