A report commissioned by the Transportation Workers Union states that stifled wages could cost up to $100 billion in retirement savings. Wages are stifled in a variety of ways including freezes, reduced penalty rates for Sunday work and the termination of enterprise agreements.
What are your thoughts on wage suppression in Australia and the possible effects?
I find it quite interesting that a union would say such and expect it is about protecting their own interests rather than that potentially of the workers.
Many unions have been shown to trade away penalty rates and wage increases for the benefit of receiving special and significant payments from employers, an example is the retail and construction industry. I am very skeptical about their claims as they have had their nose in the workers trough for their own financial benefit, at the expense of those workers.
If these payments instead had been given to the workers, these workers would have been substantially better off especially if such was added to the workers superannuation funds. The compounding effect of the superannuation contribution of many years would have significantly increased their nest egg at retirement.
Also, there has been substantial wage growth in Australia since 2007 (the GFC) compared to tbe rest of the world and other developed countries. Wage growth was thought of something which occurs year on year, but there are many past examples where wage growth has been stagnant or declined. For example, wages and take home pay often decline during recessions.
I am more concerned with the lack of paid work for older workers. I expected to work until I was 70, but in my 50’s my industry casualised (I got a redundancy as my job was outsourced) and I had short jobs with long periods of searching for the next. Interviews and applications, and being told they were looking for younger people, or they didn’t think I would last long at my age, etc. This means my savings are gone and I am eating into my assets & Super and will be a burden on the younger taxpayers, rather than a self-funded retiree.
Younger workers will be concerned with the lack of work for young people - so it really is a lack of work overall. Wage growth, Super contribution rates, tax, is all irrelevant if you can’t get job.
An opinion piece by Greg Jericho has highlighted the function Unions have in regards to getting better wages. Ms Markle outlined in her interview with Ms Winfrey the benefit of being a Union member and what happens when you don’t have that backing.
The end few sentences of Jericho’s piece are somewhat telling
" Three per cent wages growth used to be taken as given. Now anything above 2% is considered excessive. And the Morrison government is doing all it can to keep that in place – including ensuring union representation is limited and as impotent as can be.
For even if unemployment does fall to 4%, employers will increase wages only if workers are able to bargain for higher wages.
And unions have consistently produced better wage growth for workers than produced by non-union enterprise agreements.
That we are so far from wages growing by above 3% suggests that we need much more stimulus, by both the government and the RBA.
But it also means unions need to be able to bargain effectively on behalf of workers."
The RBA also has concerns for the economic forecast and that loss of Government stimulus of the economy will slow economic and wage growth.
The guy with the startled gazelle caught in the headlights look is RBA governor Philip Lowe. You might need to look more closely at the source article to decide for yourself.
Business investment has been weak for years and the most recent national accounts show it was a drag on growth. That’s despite a far better than expected half-year earnings season which delivered record profits and windfall dividends to shareholders.
Once again, employees are missing out on the earnings action, part of a decades-long trend across the developed world. The problem is that, as central bankers now are only too aware, the less workers are paid, the less they spend. And the less they spend, the slower the economy grows.
Chicken and the egg! Not good for the farmer either. Is the cunning Fox the only winner?
