Pay story December 15, 2016Posted by WorldbyStorm in Uncategorized.
…the grounds for such [public sector wage] increases need to be clearly identified and their opportunity cost (the concomitant changes in other spending or in taxes) needs to be carefully considered. In terms of a general increase, a rise in the cost of living could provide the basis for some adjustment, although the prospects for inflation suggest that any adjustment that might be justified here is likely to be very small.
Grounds for increases might also be provided by measures that boost productivity or by compelling evidence that pay is the cause of recruitment or retention problems. However, grounds such as these might form the basis for increases in pay for individual grades or clusters of grades, but not for across-the-board increases. In addition, there may be a case for unwinding measures that unduly penalise certain groups, such as new recruits.
But while he writes:
Interestingly, the European Commission has published a set of estimates, also for 2010, that puts the Irish premium at 21.2 per cent, compared with an EU average of 3.6 per cent.
He has to note that:
Given the trends in average pay in the two sectors since 2010, it seems likely that the public sector premium has declined further. Still, it is almost certainly the case that public sector workers continue to be paid significantly more than their private sector counterparts, on a like-for-like basis. Therefore, insofar as this type of analysis might be expected to provide an argument for a public sector pay increase, it is likely to disappoint.
But if he is correct in his assumption that the premium has declined, shouldn’t he at a minimum offer us some figures on what that premium might now be. Then he sort of pivots:
In any event, summary measures of the public-private pay differential are much too crude to provide a robust basis for assessing equity between the two sectors. There are many reasons for this, but among the most important is that such measures do not take into account critical aspects of employment conditions, such as tenure and pensions.
In general, public sector workers enjoy guaranteed, defined benefit pension entitlements and relative security of tenure. The value of both has surely increased appreciably in recent years.
And that’s that!
Not a word about why private sector wages or conditions are so comparatively poor. Why is it that only 40% of private sector workers have occupational pensions? Why is it that wages are so depressed in the private sector? And it’s curious because reading Paul Mason, also in the IT, he addresses the supposed issue of automation and notes that in a UK context:
If Theresa May’s government was actually listening to Carney ( instead of trying to undermine him as in reality ), they should scrap Philip Hammond’s austerity targets, raise tax revenues, shut down tax havens and take decisive measures to end the creation of low-wage, low-productive jobs. To do that you would have to re-regulate the economy and hard.
At the same time, you would have to redistribute wealth aggressively. Not all of that needs to be done through taxation. If, instead of privatising public services, you ran them as non-profit corporations, providing rail, broadband and energy at prices below the cost of production, the redistributive effect would be significant. People on rock-bottom wages would suddenly have a lot more to live on.
On top of that you need to actively raise wages. That needs more than a worker on the board: it needs a recognised union rep in every workplace. If Amazon, Pret a Manger, the courier industry and the construction firms were obliged by law to negotiate with unions, and to cease repressing them, there would be upward pressure on wages across the whole economy. Another way of creating that pressure would be for local and national government to hike public sector pay.
Oh really? Could that be because of the exemplary effect of higher PS wages? Or making conditions there normative? Could be! Because O’Leary is no fool. He knows that whittling away conditions in the PS isn’t going to assist private sector workers one bit. That as conditions bend and break in the PS it’s not that private sector employers will attempt to achieve parity but rather that wages in the broader economy will further fall. He knows that, we know that, and yet he continues as if none of these dynamics exist.
And that’s well before we get to the potential threats of automation.