Jobs put at risk by wage minimum

The introduction of a minimum wage of £4.40 per hour could put up to 50,000 jobs at risk by threatening the viability of many small firms, the Small Firms' Association (SFA) has said.

"The proposals have been parachuted in on small business without clear understanding of the particular difficulties they will have for small companies," the SFA chairperson, Ms Lorraine Sweeney, told the Joint Oireachtas Committee on Family, Community and Social Affairs.

Ms Sweeney said meaningful tax reform targeted at the low paid rather than an £800 million unnecessary bill on small business was what was needed.

"It is ludicrous that a single person pays tax on earnings above £75 per week. The Government should face up to its own responsibilities rather than asking business to do its dirty work."

An SFA survey has found that 53 per cent of small companies currently have a minimum rate below £4.50 per hour. Some 67 per cent of these firms say that a statutory minimum wage will have a negative affect on their business, while 42 per cent of such firms said it would result in job losses.

Nearly three quarters said they would curtail expansion plans as a result.

Ms Sweeney said the job losses would be in the most competitive and labour intensive sectors of the economy such as catering, retail, clothing and forestry.

The SFA also noted that the proposed rate is above that in the US, Canada, Japan and Germany, while the rate in Britain is expected to be set at around £3.70 per hour.