Workers at small firms get pay rises of 5%

Employees of small businesses saw their pay increase by an average of 5 per cent last year, according to new figures from the Small Firms' Association (SFA). On average, employees of small firms earn €30,000 a year, work 37.5 - 39 hours a week and have 21 days' holidays a year, the SFA's annual pay survey shows.

Some 71 per cent of employees of small and medium-sized enterprises (SMEs) belong to a company sick pay scheme and 42 per cent are members of a company pension scheme, the SFA said.

Less than one in five small companies - 17 per cent - supplemented State maternity benefits with additional payments. Almost one-half of small firms' employees earn €25,000 - €35,000 a year. Only 9 per cent earn more than €45,000.

Systems supervisors, trainee laboratory technicians and systems analysts enjoyed the highest pay increases in 2006, while production workers, engineers, drivers and sales staff received below-average pay increases of 2-3 per cent.

SFA director Patricia Callan said the 13 per cent increase in the national minimum wage would further increase wage inflation.

"It is imperative that future pay increases are clearly linked to increases in productivity, if our competitiveness is to be maintained," Ms Callan said. "History has clearly taught us that a wage inflation spiral is simply a lose-lose scenario for all involved."

The SFA's survey on pay and conditions was conducted among 818 companies with less than 50 employees. The companies surveyed employ a total of 14,750 people.