IHS boss Holger Bonin and WIFO economist Benjamin Bittschi see the union’s demand for 11.6 percent higher wages for the metal technology industry as a moderate approach after a real wage loss in the previous year. “Demand is very low compared to what we expected,” Bonin said Monday evening. In principle, employers and employees are right: the sector is threatened with a recession, but purchasing power must also be maintained.
The impact on inflation would be small with such a deal; without a wage increase, employees would be left with the real wage losses of the previous year, Bittschi told ‘Puls24’ on Monday evening. The federal government has kept revenues stable with one-off payments to offset inflation, but these donations are not sustainable – this must now be done through wages and salaries.
‘Danger of recession already high’
Bonin sees the required gross wage increase of 11.6 percent in “ZiB 2” as a guarantee of compensation for inflation and higher productivity. This corresponds to the ‘Benya formula’ traditionally used in collective labor agreements, but in the future it would be useful to also look at other criteria. Regarding the risk of a recession in Austria, Bonin said this risk was “already significant”.
The union’s proposals, for example to exchange pay increases for time off, are certainly interesting, according to the IHS boss. High degrees would hardly stimulate inflation in the metal technology industry, as the majority of products are already exported. Bittschi also sees no ‘rise’ in inflation, but without inflation compensation purchasing power would come under pressure.
The trade could pass on wage increases to customers
It is different, for example, with retailers, who enter into collective labor agreement negotiations after metal workers. There, wage increases could be reflected in price increases. Here you should ask yourself whether the metalworker qualification can be transferred to other industries.
The trade has lower wages anyway. The collective minimum wage in the metal sector is 2,236 euros gross, in retail 1,945 euros gross.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
