Proposed increase will lead to increased wage pressures on SMEs.
Political interference from ‘get-go’ regrettable.
ISME, Tuesday 21st July 2015.
ISME, the Irish Small and Medium Enterprises Association, has warned Government that the 6% proposed increase in the National Minimum Wage (NMW) is premature and economically unjustified and will start a raft of union demands for similar increases across the economy. The Association drew attention to the similarity to the NMW increases of 55% during the ‘Partnership years’, when wages spiraled and the economy ended in the grip of the Troika.
ISME Chief Executive Mark Fielding commented, “There is no justifiable economic argument for imposing a 6% increase on SMEs when inflation is practically zero. It is sad to say but the only reason for the increase is political survival in the upcoming election. Minister Nash stated that there would be an increase at the launch of the commission, independent my foot”.
“Given the still fragile nature of Ireland’s economic recovery and the very difficult environment for most small and medium businesses, the notion of increasing the NMW, which will have a push through effect on wages up the line, does not make any economic sense. It increases, even further, the cost base for business and will reduce the cost competitiveness of the economy.”
“Ireland has already started to drop down the competitiveness table (15th to 16th). This increase in wage rates flies in the face of the aspiration to make Ireland the ‘best small country in the world in which to do business’ and the other aspiration to preserve and improve the competitiveness of the economy”, concluded Fielding.