Wage Growth Will Halt if Economy Not Restructured, Say Trade Unions
The current upward pressure on wages as a result of decreased unemployment and workers moving abroad is cutting into profits and will ultimately harm the economy, the Trade Union Confederation has said.
“The increase of the average salary in not sustainable. What is needed is reform to boost productivity,“ Kaja Toomsalu, the confederation's wage secretary, told ETV today.
According to Statistics Estonia, the average gross monthly wage increased year-on-year by 8.8 percent in the third quarter to 930 euros, outstripping productivity growth.
The head of the confederation, Peep Peterson, said that there is still room for salary increases taken from companies' profits, but sooner or later that will be impossible. He said his organization wants to begin talks with employers of all levels to see what measures can be taken to boost efficiency.
Toomsalu said that many workers are currently overworked and are seeking new jobs, often abroad, while employers would rather spend money on finding new employees than keeping existing ones.