Pre-election promises causing postponement of employment decisions.
Taxation system should be used to put money in employees' pockets.
At the release of the latest CSO Monthly Unemployment figures, today (1st December), ISME, the Irish Small and Medium Enterprises Association, called on the Government to put the good of the economy above self-interest and desist from promoting unsustainable wage expectations. The Association warned that pre-election promises to further increase the minimum wage are already hindering job creation.
The Monthly Unemployment figures at the end of November confirm that 191,700 people are unemployed, a reduction of -700 in the month. The standardised unemployment rate is now 8.9%.
Commenting on the figures, ISME CEO, Mark Fielding, said, "The slowdown in the reduction of jobless numbers is a direct result of uncertainty among SMEs about their wage costs in the coming year. The knock-on effect of the 6% rise in the minimum wage, parental and paternity leave and the incessant call for the 'living wage' at €11.50 are making owners reassess their plans.
"It is beyond negligent for the Taoiseach to be encouraging an economically damaging upward spiral in wages. Jobs growth and competitiveness is already suffering and is likely to decrease further as politicians attempt to buy the election with employers' money."
"The tax and welfare system should be used to put money into people's pockets, rather than facilitating and promising further wage increases. The notion of pushing up wage costs at this juncture fails to recognise the business realities in what is still a very challenging economic environment for the SME sector."
The Association called on the Government to:
Stop interfering in private sector wage bargaining.
Reduce government influenced business costs to below the EU average.
Reform the social welfare system to make it more profitable to work.
Attack the scourge of ever-increasing black economy activity.
"It flies in the face of the aspiration to make Ireland the 'best small country in the world in which to do business' and the promise to preserve and improve the competitiveness of the economy. The advent of a new year and a new Administration could be a turning point for the country, if only politicians put country before self and avoided the temptation to make giveaway policy promises", concluded Fielding.