{"id":4485,"date":"2015-06-16T13:05:02","date_gmt":"2015-06-16T12:05:02","guid":{"rendered":"http:\/\/unitelive.org\/?p=4485"},"modified":"2015-06-18T10:35:32","modified_gmt":"2015-06-18T09:35:32","slug":"wages-growth-mirage","status":"publish","type":"post","link":"https:\/\/unitelive.test.igniteamt.com\/?p=4485","title":{"rendered":"Wages growth mirage"},"content":{"rendered":"
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Wages are expected to grow at the fastest rate since before the crash, many newspapers reported earlier this week. It\u00e2\u20ac\u2122s good news on the surface, but read further down their columns and the reason for growth in wages may prove to be as illusory as it is temporary.<\/p>\n

 
\nAs the Resolution Foundation noted, wages are picking up mainly because inflation has been low, dipping below zero in April for the first time in 55 years. But inflation figures released today (June 16) show that inflation, driven by higher oil prices, is picking up again and has now gone up to 0.1 per cent.<\/p>\n

 
\nWhile many will regardless see wages growth now as a cause for celebration, with more working people having greater spending power, the Resolution Foundation highlights that the \u00e2\u20ac\u015bmini-boom\u00e2\u20ac\u0165 has been a long time coming, and that it could very well be short-lived.<\/p>\n

 
\n\u00e2\u20ac\u015bIt\u00e2\u20ac\u2122s worth reiterating how long we\u00e2\u20ac\u2122ve been waiting for this kind of a rebound,\u00e2\u20ac\u0165 a Foundation blog post noted<\/a> yesterday. \u00e2\u20ac\u015bAlmost everyone has expected wages to pick up long before now, particularly with evidence of tightening slack and nascent signs of business and worker confidence. It\u00e2\u20ac\u2122s been a wage recovery long-postponed.\u00e2\u20ac\u0165<\/p>\n

 
\nThe Bank of England has predicted that nominal pay growth will be no higher at the end of the year than it will be now, if predictions for Wednesday\u00e2\u20ac\u2122s figures are correct. If this is the case, and if the BofE\u00e2\u20ac\u2122s expectations of continuously rising inflation prove true, economic recovery for working people will yet again prove tenuous.<\/p>\n

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“With our \u00e2\u20ac\u0098two-months-ahead\u00e2\u20ac\u2122 prediction indicating that nominal pay growth may not build all that much further in the short term, even a modest increase in inflation would return us to fairly weak real wage growth,” the Resolution Foundation explained, adding that focusing on productivity is critical.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bLong after inflation has moved back into more normal territory, it is productivity growth that will determine the extent to which economic recovery feeds through to pay packets. Buoyed by Wednesday\u00e2\u20ac\u2122s good news, it is to our persistent productivity puzzle that the Chancellor\u00e2\u20ac\u2122s attention ought to turn.\u00e2\u20ac\u0165<\/p>\n

 
\nNo puzzle<\/strong> <\/em><\/p>\n

 
\nUnite has long argued that, while short-term wages figures might provide feel-good fodder for headline news, sustained productivity growth is the key to real, long-term economic prosperity felt by all.<\/p>\n

 
\nUnite assistant general secretary Steve Turner said that poor productivity growth is an outcome of specific policy choices.<\/p>\n

 
\n\u00e2\u20ac\u015bWithout public investment in strategic areas \u00e2\u20ac\u201c such as housing, transport, manufacturing and communications \u00e2\u20ac\u201c the slowest, and mainly consumer driven, economic recovery on record is now slowing down,\u00e2\u20ac\u0165 Turner noted in a UniteLive comment piece last week. <\/a><\/p>\n

 
\n\u00e2\u20ac\u015bA lack of investment has led to the hoarding of cash by the corporations \u00e2\u20ac\u201c the real reason why we have poor productivity growth,\u00e2\u20ac\u0165 he added. \u00e2\u20ac\u015bAs Geoff Tily, TUC economist has noted, there is no \u00e2\u20ac\u0098productivity puzzle\u00e2\u20ac\u2122; austerity means that private companies are not investing and upgrading their equipment.\u00e2\u20ac\u0165<\/p>\n

 
\nAn Acas report <\/a>confirmed this view \u00e2\u20ac\u201c that lack of investment has been a key player in hobbling productivity. The report also highlighted how low pay, and lack of investment in the workforce in particular, have also been contributing factors.<\/p>\n

 
\nInterested in learning more about what how austerity itself is hampering productivity? Read the TUC\u00e2\u20ac\u2122s report \u00e2\u20ac\u015bProductivity: No puzzle about it\u00e2\u20ac\u0165 here. <\/a><\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Wages are expected to grow at the fastest rate since before the crash, many newspapers reported earlier this week. It\u00e2\u20ac\u2122s good news on the surface, but read further down their columns and the reason for growth in wages may prove to be as illusory as it is temporary.   As the Resolution Foundation noted, wages […]<\/p>\n","protected":false},"author":1,"featured_media":912,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[196,325,135,326],"wps_subtitle":"Pay boost short-lived once inflation returns to normal","_links":{"self":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/4485"}],"collection":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4485"}],"version-history":[{"count":1,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/4485\/revisions"}],"predecessor-version":[{"id":4486,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/4485\/revisions\/4486"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/media\/912"}],"wp:attachment":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4485"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4485"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4485"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}