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Pay

Entry 157, on 2005-04-12 at 15:11:33 (Rating 3, News)

Currently here in New Zealand many workers are trying to get a significant pay increase - the first for many years for most of them. In fact, the unions are suggesting every worker should get a 5% increase.

Naturally the employers are saying they can't afford it, the country can't afford it, or the workers don't deserve it. They don't seem to have been too worried about the obscene salary increases most of them have received since the great economic experiment began here in 1984.

Another common line used by employers is: "they can have a 5% increase if they increase productivity by 5%". That might be fair if the increase wasn't just to keep pace with inflation. Effectively employers are getting more for their money now because the workers' pay is worth less than it was originally. If they got a 5% productivity increase in return for a wage increase which just keeps pace with inflation they are getting something for nothing.

Of course, we can't blame the employers for trying this trick. After all, they didn't get to be successful business people by being fair to their employees! The dirty trick of making people feel greedy or self serving just because they have asked for a reasonable salary increase probably still works in many cases, but attitudes to this are changing, and the unions are getting stronger again which hopefully means we will have more balance in wage negotiations in future.

When New Zealand took the path to free markets and modern monetarism in 1984, we were promised that if we put up with the short term pain we would eventually get the benefits of the long term gain. Well 20 years seems like long enough to me. Now its time for the gain - or maybe that was just another trick used to encourage the people into an economic system which only seems to increase the gap between rich and poor.

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