Saturday 15 October 2011

Real wages falling fast

Just to maintain the same share of the value we produce at work, workers need a pay rise equal to inflation (to take account of the falling value of money) and their increase in productivity (to take account of the increasing value they produce).

A lot of attention is (rightly) focussing on how governments are pushing the costs of the economic crisis onto working people by nationalising bank debts and then repaying them by cutting our services and increasing our taxes. These actions reduce what is known as the "social wage".

Less attention is being given to how employers in public and private sector are using the recession to try to permanently shift wealth from workers to employers. I've produced the graph below from the latest inflation and wage figures:
It shows that since the start of 2009, when inflation took off, the value of average regular wages has already fallen by about 7%. The Average Weekly Earnings figures from the Office of National Statistics on which this is based, exclude "irregular" earnings such as overtime and bonuses which fluctuate significantly.

Many workers have seen their work intensified over the same period, and productivity driven up, so the share of what we produce that workers receive as wages will have fallen even faster than our real incomes.

We need stronger unions if we're going to beat off the attacks on our wages and our social wage. That means building them everywhere. It also makes the coordinated strikes planned for 30th November vitally important. The fight by millions of public sector workers to defend their pensions can show millions of unorganised workers the potential power of union organisation. UNITE has produced a great little leaflet to explain the issues to members in the private sector - please get it out and about.

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