Sectoral minimum pay in construction could cause unnecessart unemployment in a cyclical downturn

Patslatt1

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See https://cif.ie/2017/11/01/blog-new-sectoral-employment-order-seo-means-business/
Given that the construction industry often experiences long cycles of growth and downturns, sometimes lasting for a decade or more,legislated sectoral minimum pay could cause unnecessary unemployment in downturns. If the minimum is set well below the prevailing market wages and benefits, there would be a cushion where market wages could fall before wages became uneconomic and caused unemployment. However, outside of greater Dublin and greater Cork, the market wages are likely to be close to the minimum, so unemployment is a biggger risk.

A sensible reduction in the minimum wages in recognition of recession conditions would likely prove impossible for trade unions. That suggests the minimum should be set at a level close to the estimated market wages in an industry recession.

It will be argued that construction workers need protection on wages. But most workers in construction are highly mobile and their careers are not dependent on any company, unlike many occupations. I reckon the Romanian workers who are being paid about a third less than the minimum wage in recent news reports would quickly have used their contacts in the Romanian community to find other jobs paying market wages. That has been the experience of generations of immigrants to the USA, much to the disappointment of their first employers.
 


neiphin

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Are you advocation for wage increases?
 

Barroso

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See https://cif.ie/2017/11/01/blog-new-sectoral-employment-order-seo-means-business/
Given that the construction industry often experiences long cycles of growth and downturns, sometimes lasting for a decade or more,legislated sectoral minimum pay could cause unnecessary unemployment in downturns. If the minimum is set well below the prevailing market wages and benefits, there would be a cushion where market wages could fall before wages became uneconomic and caused unemployment. However, outside of greater Dublin and greater Cork, the market wages are likely to be close to the minimum, so unemployment is a biggger risk.

A sensible reduction in the minimum wages in recognition of recession conditions would likely prove impossible for trade unions. That suggests the minimum should be set at a level close to the estimated market wages in an industry recession.

It will be argued that construction workers need protection on wages. But most workers in construction are highly mobile and their careers are not dependent on any company, unlike many occupations. I reckon the Romanian workers who are being paid about a third less than the minimum wage in recent news reports would quickly have used their contacts in the Romanian community to find other jobs paying market wages. That has been the experience of generations of immigrants to the USA, much to the disappointment of their first employers.
Fine Gaeler argues for wage decreases. After a decade of dropping wages, and in the midst of growing poverty.

Hardly a surprise for those of us who know FG, but a disgrace nonetheless.
 

neiphin

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would pat not come back and defend his position
or his he just trolling
 

Patslatt1

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Fine Gaeler argues for wage decreases. After a decade of dropping wages, and in the midst of growing poverty.

Hardly a surprise for those of us who know FG, but a disgrace nonetheless.
It's good that wages are rising but construction shouldn't be stuck with uneconomic minimum wages that could cause unnecessary mass unemployment in industry downturns. A flexible minimum wage geared to market conditions is theoretically possible but politically impossible.
 

fifilawe

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It is also theoretically possible to go to Mars but currently practically uneconomic and physically any psychologically indefined
 

Dame_Enda

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Main problem is bogus self employment used to avoid minimum wage.
 

PBP voter

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Engineers,Architects,Q/S,Health and Safety Officers etc will always be low paid because they have no union.
 

Patslatt1

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Engineers,Architects,Q/S,Health and Safety Officers etc will always be low paid because they have no union.
Supply and demand determines wages, not unions whose influence on private sector wages is negligible. Unions do extract excessive pay from the government because of the political system's pandering to vested interests.
 


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