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Title: Latest developments in wage bargaining in Europe: A comparative overview on wage indicators in the E


1
Latest developments in wage bargaining in Europe
A comparative overview on wage indicators in the
European metal sector and total industries
  • Vera Glassner, ETUI (Research)
  • EMF Summer College 2008
  • 14 17 September 2008, Lovran/Croatia

2
Economic Background European metal sector
(EU25)Developments 1995-2005
  • -Changes 1995-2005 (KLEMS 2008)
  • GROSS OUTPUT
  • Automotive 81,5 , Total industries 45 ,
    basic metals 41 , total manufacturing 37
    , machinery 37
  • EMPLOYMENT Total industries 11.5 , automotive
    5 , basic metals 1,4 , machinery 7,7 ,
    total manufacturing -8,4
  • LABOUR PRODUCTIVITY (gross value added./hrs.
    worked) automotive 47 , machinery 44 ,
    total manufacturing 37,5 , basic metals 31 ,
    total industries 28,6
  • LABOUR COMPENSATION (compensation of empl./hrs.
    worked)
  • Automotive 42 , machinery 40 , total
    manufacturing 34,7 ,
  • basic metals 28 , total industries 29

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Economic Background European metal sector
(EU25)Output Employment
  • Changes in - 1995-2005
  • GROSS OUTPUT Outstanding position of sectors
    such as automotive investment goods ? ABOVE
    TOTAL INDUSTRIES!
  • -Change higher in TOTAL INDUSTRIES than in
    MANUFACTURING due to very dynamic sectors such as
    transport ( 81,5 ), finance business services
    ( 83 ), telecommunications ( 98 ) and energy
    ( 138 )
  • EMPLOYMENT MANUFACTURING negative trend METAL
    sector branches ABOVE level of MANUFACTURING but
    positive trend only in automotive!
  • Employment growth in SERVICE secotors (market
    non-market services, personal financial
    services

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Economic Background European metal sector
(EU25)Labour Productivity (LP) Labour
Compensation (LC)
  • Changes in - 1995-2005
  • Inter-sectoral comparison
  • LP in line with LC, exception basic metal
    production Although LP growth higher than in
    total industries, compensation increase laggs
    behind that in total industries.
  • Comparison of growth levels of LP LC
  • General trend LC growth laggs behind growth of
    LP in total MANUFACTURING and in METAL sector
    branches in particular!
  • Reverse trend in TOTAL INDUSTRIES! Compensation
    growth above prod.-growth in particular in
    service sectors such as personal, market
    financial services!

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Economic Background European metal sector
(EU25)Unit Labour Costs (ULC)
  • Development ULC 1995-2005
  • TOTAL INDUSTRIES 0,27
  • TOTAL MANUFACTURING - 0,74
  • METAL sector branches Automotive 2,22 ,
    Investment goods 9,1 , basic metals 12,5 ,
    machinery 14,4
  • Total industries, total manufacturing, machinery
    automotive started from a relatively SIMILAR
    LEVEL in 1995 strongest DECLINE of ULC in
    machinery, basic meteals and investment goods!
  • More stable (but slightly NEGATIVE) development
    in AUTOMOTIVE and TOTAL MANUFACTURING, slightly
    POSITIVE in TOTAL INDUSTRIES!

9
Fig. 6 The macro-economic level Changes in
real unit labour costs (index 1995100, AMECO)
10
Ad. Fig. 6 - Real unit labour costs (index
1995100, AMECO
11
Fig. 7 The macro-economic level Changes in
Wages and Salaries (nominal), Eurostat
12
Ad. Fig. 7 Wages and Salaries (nominal)
1995-2006
13
Trends in wage developments Real Unit Labour
Costs (RULC) and nominal Compensation
  • General trends changes 1995-2000 and 2001-06/7
  • RULC
  • Decreases predominate over increases in EU
    countries in both periods considered.
  • Negative development in both periods BG, PL, LU,
    ES, HU, SI, AT, DE
  • Positive developments in particular in RO, LV
    also SW
  • ? mirrors trend towards DECREASE OF WAGE SHARE in
    EU and EUROZONE in particular!
  • Nom. Wages Salaries
  • Stagnation DE (3 2001-06!), AT, BE, NL BELOW
    EA13 and EU27 average ? also reflected in CB
    results!
  • Higher Dynamism Baltics, HU, SK, IE, BG ? high
    nom. Wage increase NOT reflected in RULC growth
    due to soaring inflation!

14
Fig. 8 Development Gender Pay Gap (Eurostat
2008)
15
CB-Coverage No gender-gap?
16
CB-Coverage contd No gender-gap?
17
Further wage trends GENDER PAY GAP (GPG) and CB
  • Gender Pay Gap (measured as difference between
    male and female wages in ) proves to be
    persistent, only minor changes towards a
    redection of the GPG between 2000-07!
  • DECREASES larger decreases in IRE, EE, HU, RO
    and GR
  • INCREASES IT, DK, FI, DE!
  • REVERSE NORTH-SOUTH divide Low GPG in Southern
    countries compared to Scandinavian countries!
    Possible reason low employment rates of women in
    the Southern European countries.
  • GPG and CB coverage
  • CB coverage rates do NOT largely differ between
    men and women, CB rate of women tends to be
    HIGHER than that of men (exc. LUX).
  • Possible reasons
  • Top executives sometimes excluded from coll.
    Agreements, women underrepresented in this group
    of employees
  • CB coverage in the PUBLIC sector tends to be
    higher than in private sector, higher share of
    female employees in public sector!

18
Fig. 9 Statutory minimum wages 2008, EU27
19
Fig. 5 Changes in statutory minimum wages, EU27
20
Fig. 10 Increase of statutory minimum wages
2007-08, EU27
21
Statutory minimum wages Latest trends
developments in the EU27
  • Highest nominal levels (1.200 1.600 EUR) LU,
    IR, NL, BE, FR, UK (Eurostat 2008)
  • Statutory min. wage in of national average wage
    (EC 2005) FR (62), IR (56), GR, HU (51 ), BE,
    LU (49 ) lowest CZ, ES (32 ), PL (33 ), EE
    (34)
  • Changes 2002-08 STAGNATION in GR, UK (approx. 2
    ), highest increases SK, BG, PL (approx. 40-50
    ), LT, EE ( 60), RO and LV (approx. gt 95 ).
    BUT rather a catch-up process in LT, RO LV
    since prior increases (2002-05) low or even
    negative (PL)!

22
Tab. 3 Statutory Min. Wages Adjustment
Mechanisms
23
Tab. 4 Institutional setting of CB in Countries
with Provisions for Statutory Minimum Wages
24
Institutional features of the CB systems in the
EU27
  • Factors which strenghten CB and CB coverage rate
    in addition to statutory min. wage provisions
  • Pervasive PRACTICE to EXTEND collective
    agreements in BE, ES, FR, PT
  • Functional equivalents to extension rules
    compulsatory membership in employers
    association until June 2006 in SI, since then no
    obligatory membership in Chambers of Commerce and
    Industry BUT important role of formerly
    obligatory membership organisations in CB!
  • Result in all of these countries CB coverage
    rate gt 80 !

25
Tab. 5 Institutional setting of CB in Countries
WITHOUT Provisions for Statutory Minimum Wages
26
Institutional features of the CB systems in the
EU27
  • Factors which strenghten CB and CB coverage rate
    in countries WITHOUT provisions for statutory
    min. wage
  • PRACTICE to EXTEND coll. agreem. pervasive FI,
    functional equivalent in IT (fair pay
    constitutional right)
  • COMPULSORY MEMBERSHIP in employer associations
    AT
  • High UNION DENSITY (gt 70 ) CY, DK, SW, FI ?
    countries without extension rules indirect
    functional equivalent!
  • Result CB coverage high (gt 80 ) AT, DK, SW, FI
  • Exception In DE NONE of these POSITIVE
    institutional requirements are existing
    PROBLEM erosion of coll. agreements and danger
    of dis-organisation of CB!

27
Tab. 6 Wage indicators 2007 (annual changes in
)
28
Tab. 6 (contd) Wage indicators 2007 (annual
changes in )
29
CONCLUSIONS
  • Protracted trend towards wage moderation in terms
    of widely negative development of RULC in
    EU27/Eurozone in particular COORDINATED
    CROSS-BORDER APPROACH ON WAGE BARGAINING!!
  • STATUTORY MIN. WAGES as instrument to set a floor
    to down-ward spiral on wage formation and prevent
    poverty FUNCTIONAL EQUIVALENTS (Ghent system,
    high union densities, extension rules, compulsory
    membership in employer associations) in countries
    without rules for statutory min. wages
  • EUROPEAN INTEGRATED APPROACH ON WAGE POLICY
    either statutory min. wage or collectively
    negotiated wages ? minimum criteria, e.g. giving
    a minimum threshold for minimum wages in of
    national average wages!
  • OMC approach Goals set on the European level
    implemented according to national traditions by
    national social partners OR
  • Min. wage policies integrated in a broader
    framework of trade union policies on the
    transnationalization of CB!
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