Editorial: Raise wages!
Negotiations on setting the new minimum wage in the private sector are to begin in the coming days.
The government is entering the talks with trade unions having pledged in its electoral campaign last year to support wage hikes in 2020 that are double the country's growth rate.
New Democracy's pre-electoral calculations were based on the aim of maintaining the competitive advantage of the economy attained during the decade-long economic crisis.
If the 2.8 percent of GDP growth target projected in the state budget is met, then the promised wage increase for 2020 will amount to 5.6 percent.
That means that the current monthly minimum wage will increase by about 37 euros, from 650 to 687 euros.
Clearly that does not constitute a substantial change in the labour cost for businesses. Instead, it reflects deep wage cuts during the crisis.
The case of Hellenic Telecommunications (OTE) is indicative. The collective bargaining contract concluded between management and the OTE employees' union enshrined the government's linkage between economic growth and wage increases.
For employees who were hired before 2015 a retroactive (as of 1 January 2020) wage hike of 4.5 percent was agreed to along with another 3.5 percent wage increase as of 1 July, 2021.
According to OTE's figures the cumulative wage increase will be approximately eight percent. Wages fell by a total of 9.5 percent between 2012 and today.
More recent hirees that joined the firm after 1 January, 2015, and were the lowest paid employees in the company will receive a 5.5 percent wage increase as of 1 January, 2020, and another 3.5 percent hike as of 1 January, 2021.
The government should take note of the case of OTE and exhibit a similar generosity. It...