Employers say no justification for increasing minimum wage

The employers’ group Ibec has said there is no justification for increasing the current national minimum wage of €8.65 at this time.

It said an inappropriate rise in the existing rate at a time of high unemployment could hinder further job growth, particularly hit young and unskilled job seekers and threaten business viability, especially in the regions.

The comments came as the Government's new Low Pay Commission is expected within the next few days to begin its work of examining the national minimum wage rate.

Minister for Business and Employment Ged Nash, who has backed a rise in the minimum wage, expects to receive recommendations from the commission by the summer.

Ibec has also warned against the introduction of a higher “living wage” which campaigners have urged should be set at €11.45 per hour.

The employers’ organisation said a “living wage” would come with a fiscal cost and would hurt employment.

In a presentation prepared for an appearance today before the Oireachtas Joint Committee on Jobs and Enterprise, Ibec said it supported the minimum wage as a principle and recognised that it should increase as economic circumstances improved.

Ibec said the minimum wage in Ireland was high by international standards.

“At current exchange rates our national minimum wage is about the same as the £6.50 per hour rate in the UK. At the exchange rate of 12 months ago it was 10 per cent higher.

“Exchange rates are volatile and it is vital that Ireland sets its rate at a level which doesn’t leave businesses such as food processing . . . or the tourism sector vulnerable to exchange rate volatility,” it said.