6 April, 2023

Mandated wage rises for the low-paid?

Leftist policies often sound fair and reasonable to start with.  But then the adverse results of them start coming in. And the idea of a big wage rise for the lowest paid seems wonderful at first.  And puts the government in a very good light as "caring".

But the idea is in fact a policy to throw many poor people out of a job. People who are very low paid are low paid for a reason.  Their services are seen as worth only a minimum.  And in many cases that will be a bare minimum.  Raise what you have to pay them and that pay will exceed the value of what their services are worth.  So they will be fired.  Employing them will have become a losing proposition and no longer be seen as worthwhile.  Not all of the low paid will be laid off but many will be.  Not so much of a warm glow in that

Hundreds of thousands of low-paid workers should receive ­inflation-linked pay rises, the ­Albanese government has urged, as business warns the economy risks being plunged into recession if unions succeed in their push for a 7 per cent increase for 2.6 million workers.

Urging the Fair Work Commission to ensure the real wages of the lowest paid “do not go backwards”, the government submission to the annual wage review will seek to limit the inflation-linked rises to workers on the national minimum wage and lowest award rates.

Employer groups said granting the ACTU’s “economically reckless” claim for a $57-a-week increase would add $12.6bn a year to employer costs.

The Australian Chamber of Commerce and Industry will urge the commission to limit the pay rise to 3.5 per cent, which at $28 a week would represent a real pay cut but be the highest ever proposed by the employer group.

In a joint statement, Treasurer Jim Chalmers and Workplace Relations Minister Tony Burke said economic conditions remained challenging, with Australians facing high inflation due to supply-chain disruptions and the war in Ukraine.

“While nominal wages growth has lifted, high inflation has seen real wages fall behind,” they said.

“This is having the greatest ­impact on Australia’s low-paid workers and their families – many of whom don’t have the savings to fall back on or wages that cover the rise in living costs.

“These workers are more likely to be women, under 30 years of age and employed as casuals. The government does not want to see them go backwards.”

Labor’s stand in support of low-paid workers came as the government appointed five people with union backgrounds to the commission, declaring it wanted to fix the Coalition’s “shameless stack” of the tribunal with ­appointees from employer ­backgrounds

https://www.theaustralian.com.au/nation/bosses-warn-granting-actu-pay-claim-risks-recession/news-story/1015af03e12dd44f155667945a0b43e3

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