by Keith Locke
Arguments employers used during the recession to stop wages rises don’t hold much water now. So it is not surprising there is now a small wave of industrial action for improved wages and conditions. In the state sector, the ACC and Housing New Zealand workers escalating their efforts to force their empoyers into serious negotiations.
This week metal workers, part of the EPMU union, hold stopworks across the country for a 3.5% wage increase, which they deem necessary to compensate for inflation (including the GST rise). In Penrose (south Auckland) Paper Reclaim workers have been on strike for three days for a $1 an hour rise. The National Distribution Union, which represents them, says some are paid less than $15 an hour.
One of the most vigorous efforts has been conducted by the Unite union for the workers at JB Hi-Fi shops, who haven’t had a rise for three years and are paid only 75 cents over the minimum wage. I dropped in on one of Unite’s spirited pickets outside JB Hi-Fi in Auckland’s Queen St last Saturday. The workers pointed out that company’s CEO Richard Uechtrit has just picked up a bonus of $1 million, bringing his annual pay to $4 million.
Published in Economy, Work, & Welfare by Keith Locke on Mon, July 5th, 2010
Tags: EPMU, JB HI Fi, National Distribution Union, picket, protest, Unite Union, wages
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on the trolls and those who are unable to keep on topic
I’d picket them just for their manic over the top shout-in-your-face advertising.
Them and a few others.
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oh Keith I commend your tireless efforts to increase the unemployment rate, specially that of our youth. I doubt that you wake up every morning thinking how best can we raise and keep youth unemployment above 30%.
For anyone that truly wants to raise the economic condition of the WHOLE country instead of just interest groups I suggest reading Hazlitt’s Economics in One Lesson. But even if you are a hard leftist it helps your own argument if you can HONESTLY understand counterarguments.
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One of the problems that you find if you push wages up is that employers compensate by expecting the average employee to do more. For instance, in a certain supermarket group in New Zealand, in about last year, a policy was implemented of not replacing staff when they called in sick – if there is one person off sick, then you find that there usually isn’t problems, but as soon as two people are off sick, then you add to the stress for everyone and that includes customers. Senior management of this group had placed pressure on the rank and file to cut and cut and cut.
How much of this has been caused by increased wages? I don’t know, but the danger is that by pushing for higher and higher wages is that you just encourage employers to expect more and more from their staff.
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John Barbutto is a nice guy – come on buddy – give up them cigars b4 they hurt ya and cough up 4 the workers hey?
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Though at higher wage levels, there seems to be less and less expected from staff. A lot of decision making and responsibility has been pushed down the corporate ladder to lower paid staff. The top dogs seem to have embraced a culture that is all rewards and no consequences for failure.
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Sam; I used to participate in extremely long and complex Meetings whilst a reasonably senior public servant.
The point of most of it was divorcing the question of Wages and Conditions from any emotional content.
I found it a simple matter to ‘get real’ in this regard – mind you – the minimum wage in Australia is a good bit better than here.
A large part of Greece’s financial woe’s are caused so many low paid and unpaid people driving that Nation’s Tax Income into virtual penury.
Thus Government services are cut and this feeds the former problem – a self-perpetuating financial implosion.
A whole new kind of poverty – still, the weather here’s holding up pretty well
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Mark – as is the cost of living higher in OZ
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“Arguments employers used during the recession to stop wages rises don’t hold much water now.”
Why is that? Has the economy recovered?
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Daniel,
I’ve had a go at reading Hazlitt. I don’t feel that he takes ~~real productivity~~ in the household sector adequately into account. For example:
– the demographic transition
– the educational value of feeding children
– the labouring value of educating children
If you re-read the “curse of machinery” chapter while thinking of people as (part-time) machine parts, that might give you a flavour of the objection.
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“The point of most of it was divorcing the question of Wages and Conditions from any emotional content.”
In this context, does ‘emotional content’ mean treating people as human beings and recognising their actual needs? (as opposed to the artificial ‘needs’ of ‘the economy’.)
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Hazlitt and others who publish basic theories of economics know it is far more complicated. The idea that higher wages suppress demand for labour assumes elasticity of demand for labour is infinite. In fact lower wages do not result in lower prices as the business owners and banks simply take the difference. The proportion of GDP paid in wages has dropped markedly since neo-liberalism took hold. Whatever the wages businesses still need employees to continue. Lowering wages in the end is self defeating because if they are too low no one can buy your products, there is even less demand for labour and then wages go down still more = depression.
Read Keynes and Freidmen and see how totally opposite economists views can be.
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