Unrealistic wage expectations must not be fuelled by ministers ‘playing to the crowd’.
High business costs and over-generous social welfare stopping job creation.
Long-term unemployed still a major concern.
ISME, Tuesday 26th August 2014.
Welcoming today’s CSO Quarterly National Household survey results (26th August), however, ISME, the Irish Small & Medium Enterprises Association, warned that jobs cannot be created while costs are increasing and trade unions fuel unrealistic wage expectations. The Association called for greater emphasis on cost controls, not alone in wages but across the board, in order to maintain competitiveness.
The Quarterly National Household Survey, the official recording of the labour force, confirmed that the seasonally adjusted unemployment rate currently stands at 11.5%, however 57.6% of unemployed persons fall into the long-term unemployed bracket and continue to be a cause for concern.
According to ISME Chief Executive, Mark Fielding, “One of the big dangers is that, as fragile economic recovery starts to take hold, the opportunistic trade unions have begun to trigger demands for higher pay. This is before the jobless figures have been reduced sufficiently and is holding back new recruitment. Despite small gains in competitiveness in recent years, pay rates in Ireland are still high by European standards and there is no room for increases in the short term”.
“While the Taoiseach’s main aim is more jobs, he needs to caution some of his labour colleagues, who are openly courted by the unions, ‘playing to the crowd’ and fuelling unrealistic expectations of pay rises both in the public and private sectors.”
“The main aim of Government must continue to be job creation and job retention. The administration must address high business costs, the inept social welfare system, the black economy, and the lack of credit, each of which creates a disincentive for SMEs to increase employment”.
The Association called on the Government to:
Carry out the promised reform of the public sector.
Focus on cost-competitiveness related to our international competitors.
Overhaul the ‘unfit for purpose’ social welfare system to make it worthwhile for people to work.
Immediately release funds for shovel-ready, job-rich infrastructure projects.
Attack the scourge of ever-increasing black-market activity.
Address the lack of bank credit for productive SMEs.
“Jobs will not be created if business continues to be brutalised by increasing costs, hampered by an over-generous welfare system and undercut by the black economy. We need to incentivise SMEs through pro-enterprise policies”, Fielding concluded.