It absolutely can, with a combination of price increases and productivity improvements.
Can we afford pay increases to match inflation?
- Thread starter RainyDay
- Start date
It absolutely can, with a combination of price increases and productivity improvements.
Re: Inflation wage increase
That's frightening.
Do you really think that we can improve our productivity, as a whole, by more than 6.5% per year?
I know companies can increase their productivity by more than 6.5% per year but they can do it by sacking the inefficient part of their work force. Unless you are advocating Thatcherite measures, and my guess is that you are not, what's your plan?
That's frightening.
Do you really think that we can improve our productivity, as a whole, by more than 6.5% per year?
I know companies can increase their productivity by more than 6.5% per year but they can do it by sacking the inefficient part of their work force. Unless you are advocating Thatcherite measures, and my guess is that you are not, what's your plan?
Re: Inflation wage increase
a) your picking of an arguement through selective reading of my post.
b) your assumption that one single solution applies to all companies and all industries
What's really frightening is
a) your picking of an arguement through selective reading of my post.
b) your assumption that one single solution applies to all companies and all industries
Re: Inflation wage increase
I quoted your full post.
I made no such an assumption.
So how can we improve the efficiency of out entire economy by 6.5% (or more) per year?
I quoted your full post.
I made no such an assumption.
So how can we improve the efficiency of out entire economy by 6.5% (or more) per year?
Re: Inflation wage increase
Indeed you did, but your response referred exclusively to one of the two parts of my response. Go back and read it a third time and see what you get.
Re: Inflation wage increase
I just did and I'm still not getting it. Price increases which make us uncompetitive are a result of the pay increases. You are saying that this can be offset by increases in our efficiency which will keep our economy competitive. I am asking how we can achieve 6.5% increases in the efficiency of our economy. I’m not trying to be argumentative and I don’t think my question is unreasonable.
Re: Inflation wage increase
Now you're putting words in my mouth!
I referred to 'price increases', and you have now developed this into 'price increases which make us uncompetitive are as a result of the pay increases'. I didn't refer to price increases which make us uncompetitive. I also never stated that we can achieve 6.5% increases in the efficiency of our economy, so there is no such question to answer. I'm sure there are companies and industries where such gains (and more) are achievable, and I'm sure there are companies and industries where such gains are not achievable.
My original comment on this thread was simply to point out the one-sided-view of rabbit's comment. Now on double-checking it, I find that perhaps I might agree with one aspect of rabbit's post - I wouldn't suggest that the economy could sustain 6.5% for every employee. There are cases where this is sustainble, and cases where it is not.
Now you're putting words in my mouth!
I referred to 'price increases', and you have now developed this into 'price increases which make us uncompetitive are as a result of the pay increases'. I didn't refer to price increases which make us uncompetitive. I also never stated that we can achieve 6.5% increases in the efficiency of our economy, so there is no such question to answer. I'm sure there are companies and industries where such gains (and more) are achievable, and I'm sure there are companies and industries where such gains are not achievable.
My original comment on this thread was simply to point out the one-sided-view of rabbit's comment. Now on double-checking it, I find that perhaps I might agree with one aspect of rabbit's post - I wouldn't suggest that the economy could sustain 6.5% for every employee. There are cases where this is sustainble, and cases where it is not.
G
Gautama
Guest
This was my plan. However, the IT job market is quite poor at present. To cut a long story short, moving would incur a 20% pay cut!
Given that I'm in the early years of a mortgage, that would be financial suicide.
I'm the citizen of three states, and I have worked abroad in the past. But I gotta stay, at present, Ireland is the best place in the world to live, so I'm staying put!
Our economy cannot sustain if the Government gets 15% wage increases every year.
More than I expected but not what I asked for. Given last year's performance, I'm worth more that 6.5%. Those that did absolutely nothing got 4%!
Generally, real wages can grow at the rate of growth of labour productivity.
Taking Germany over the past few years as an example:
Nominal wage growth was low, say 1-2% pa
Real wage growth was approx 0% pa
Labour productivity improved
So the real labour cost per unit of output fell, making the economy more competitive.
Of course, trade unions are now attempting to capture back some of the gains in the economy,in the form of higher nominal wage growth.
In the long run, we can only afford real wage growth as much as labour productivity improves.
Taking Germany over the past few years as an example:
Nominal wage growth was low, say 1-2% pa
Real wage growth was approx 0% pa
Labour productivity improved
So the real labour cost per unit of output fell, making the economy more competitive.
Of course, trade unions are now attempting to capture back some of the gains in the economy,in the form of higher nominal wage growth.
In the long run, we can only afford real wage growth as much as labour productivity improves.
Re: Inflation wage increase
I’ve never come across price increases that make us more competitive.
I accept that you never said that but do you agree that for pay increases of 6.5% to be sustainable then efficiency will have to increase by the same amount. I agree that there are some companies that can achieve this and some companies that can’t but much like the miners’ strike in the UK in the 80’s there’s a strong argument that the social cost would outweigh the economic benefit.
Fair enough.
R
rmelly
Guest
Our economy cannot sustain if the Government gets 15% wage increases every year.
Of course if could.
True, we shouldn't confuse political and economic issues
G
Gautama
Guest
Our economy cannot sustain if the Government gets 15% wage increases every year.
Note the smilie!
However, if you want to ignore the smilie and take the comment in a serious frame of mind, think of value for money.
Mary Harney told us to "shop around".
Are we getting value for money by giving our Minister for Wealth a 15% pay increase? Just today she missed the Cystic Fibrosis debate in the Dail because she was at the SuperBowl!
Not true
Our opportunity to 'shop around' came and went at the last election. It seems a majority of the population felt that the competing 'products' on offer were not worth buying instead.
She was in the USA on a visit that had been arranged for a long time. She went to the Super Bowl as a guest of some of the people she met there. It may be the case that she should have cut her trip short to be at the debate here but I don't know who she met there or how important those meetings were so I am not in a position to comment. That is clear is that saying that she was not in the Dail because she was at the Super Bowl without putting it in context is misleading to say the least.Seems she was at least at the superbowl. See here. Also heard she was on a week long trip that just happened to be where the superbowl was on
Anyway, none of this is on topic.
R
rmelly
Guest
The economy could sustain a 15% increase in Government salaries indefinitely. The total across Dail and Senate is maybe EUR 200 million (including salaries, pensions, expenses, drivers etc), versus a total yearly tax take in excess of 40 billion.
I'd rather we focussed on getting value for money from the other 300,000 public sector employees that cost the exchequer tens of billions a year.
C
coola
Guest
oh stop please. 15% rise in govt salaries, are you mad!!! let them join the private sector and watch them whinge then when they have a crap pension and get 4 weeks notice if they are to lose their job
Not going to happen in a hurry, Harney for example will devote enormous amounts of time, effort and cost squeezing moderate savings from indirect employees, E.g. GPs/pharmacists/consultants (not that they’re not worthwhile; and no I'm none of the above) instead of tackling her own backyard where billions are at stake. Why…? Maybe, because she's public sector herself? Maybe, not up to tackling unions? Maybe, because across the public sector 300,000 = a lot of votes? Who knows?