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In the current round of incomes policy negotiations SAK aims to achieve a three per cent
increase in the purchasing power of wage-earners next year and in 2002. This objective
will be realised if payroll costs are increased by 3.8 per cent next year and by about 3
per cent in the following year.The SAK pay claim
includes a gender equality adjustment of 0.4 per cent to be reserved for low-paid jobs and
for those in which there is a majority of women workers.
Besides wage rises, purchasing power will be enhanced by
the income tax cuts which the government has promised next year. SAK proposes that in the
year 2002 the government should abolish the minimum tax deduction for travelling expenses
which is currently four per cent of earnings.
SAK is also insisting on an indexation clause and an
incomes development guarantee.
SAK justifies its wage claims on the grounds that they
constitute partial compensation to wage-earners for high inflation mainly due to the rise
in oil prices. The estimated rise in consumer prices is 3.5 per cent this year and 3 per
cent next year. In 2002 the rate of inflation in Finland should fall to the 2 per cent
target level of the Euro economies.
Mr. Lauri Ihalainen, President of SAK,
stresses that while the burden of paying for more costly oil should not fall wholly on
wage-earners, it can nevertheless not be fully compensated by wage increases:
"SAK is now seeking a new stability and predictability
in the economy. We would like to support inflation control but also ensure the growth of
wage-earner purchasing power."
SAK has called attention to the fact that Finland is now
one of the world's most competitive economies and that its labour costs are below the
European Union average.
Inflation erodes the rise in purchasing power
There will hardly be any growth at all in the purchasing
power of Finnish wage-earners this year, with a likely rise of less than one half of one
per cent. This is due to accelerating inflation and a shortfall in the taxation policy
inflation adjustment. The rate of inflation was 4.2 per cent at the end of September.
Nominal earnings will rise this year by 3.6 to 4.3 per cent.
The productivity of labour in Finland has increased in
recent years by an annual average of about 2 per cent. Productivity improvements have
varied considerably between industries, however, with a 15 per cent rise in the
electronics sector. Productivity next year is expected to rise by an average of 2.5 per
cent.
Leena Seretin |
