Fair work and a real recovery
ICTU’s Macdara Doyle puts the case for higher wages and improved conditions as a foundation for a better economy.
Recent studies from the very reputable (and trade union-funded) Nevin Institute tend to confirm the nagging and persistent doubts that many feel in relation to Ireland’s economy in the aftermath of the Great Crash of 2008. We have learned from long experience to treat all claims of ‘recovery’ with the healthy scepticism they deserve, knowing that the more frequent and strident the claims, the less grounded in reality they are likely to be.
The previous, calamitous FF-Green administration had the country dizzy from the number of times they proclaimed us to be ‘turning the corner’. On this occasion, it does appear there is some substance to the claims. But the harder question to answer is: “What type of recovery?”
It is a critical question, because the nature of the recovery will determine what type of Ireland emerges at the other side and whether we might find ourselves staring back into the abyss in a few short years.
Which is where the Nevin Institute’s research and nagging doubts come in. According to NERI’s most recent Quarterly Economic Observer (for spring 2015), Ireland has a growing problem with low pay and poor working conditions, such that we could be characterised as a low pay economy.
A cursory reading of history will provide ample proof that low wage economies generally do not thrive, prosper or create decent societies. And as we approach the centenary of 1916, it is worth noting that such societies – based on low standards and exploitation – are incapable of “cherishing all the children of the nation equally”.
According to the NERI study, some 25 per cent of employees earn below the living wage threshold of €11.45 per hour. In other words, that’s 345,000 working people without sufficient income to afford basic necessities, in terms of food, clothing and shelter. And as the ongoing (at the time of writing) Dunnes dispute highlights, the situation is a little more complex than just a low hourly rate for the job. That dispute is centred on low hour contracts and the corrosive culture of precarious work. If you cannot even be assured what hours you might work from week to week, you will experience huge fluctuations in income. Thus, we have heard Dunnes workers in full-time employment explain that they are unable to secure mortgages or basic loans, because of the precarious nature of their employment. Hardly surprising then that NERI again concludes that “the risk of low pay is much greater for employees on low hours (less than 20 hours) where more than one in two are low paid.”
Wider Irish society does not benefit from these practices. There is a longer-term human and social cost to keeping people mired in penury. In addition, there is a substantial annual cost to the Exchequer and therefore the citizens of this state.
In some sectors of the economy, wages are so low that the workers concerned qualify for social welfare payments, such as – but not exclusively – family income supplement. The annual cost is of the order of €300 million. In other words, the state is subsidising the wage bill and the profits of some very large and very profitable employers.
Coincidentally – if you believe in such things – the incidence of low pay and precarious work tends to be highest in the sectors that also score highest in terms of breaches to employment rights legislation. Illegality and lawbreaking, in plain English.
In the coming weeks, Congress will pursue a very public campaign that aims to restore a degree of decency to peoples’ working lives. It will focus on pay levels, fair hours of work, the right to union representation and protection, the right to decent treatment at work and how public procurement policies can be made an agent of public good. Ultimately, the Congress Charter for Fair Conditions at Work rests on the very clear principle that a strong economy cannot exist in the absence of a fair society.
www.ictu.ie/congresscharter
