When government’s refuses to act, workers have only one defence- put in a pay claim.
Every worker needs a pay increase of at least 1% to cover past losses and to match rising prices.
According to the European Commission, labour productivity increased by 34% from 2010 to 2017, at the same time as nominal unit labour costs fell by 17%.
The wage share for workers fell from 53% of GDP in 2008 to 40% in 2016 – or from 53% to 49%, when the distorting effects of tax haven activity are stripped out. Overall wage costs fell by 8% – mirrored by an increase in profits of more than 8%.
With growing shortages, the balance of power is now returning to workers. It should be used to press for higher wages.