Private sector unions advised to seek pay increases of up to 4.5% next year

Ictu says labour issues mean workers can secure wage growth above ‘long-run average’

Private sector unions should seek pay increases in the range of 2.5 per cent to 4.5 per cent next year for their members, the Irish Congress of Trade Unions (Ictu) and the Nevin Economic Research Institute (Neri) have recommended.

The advice, issued by Ictu and Neri in conjunction with each other, comes as private sector job vacancy rates are at their highest since 2008.

A tightening labour market “affords workers the opportunity to obtain wage growth in excess of the long-run average”, a statement from Ictu said.

Dr Tom McDonnell, co-director of Neri, said workers in the private sector of the economy are making a significant contribution to the profitability of the firms in which they work.


“They deserve to have a share in the wealth that is generated as a result of this contribution,” he said.

“It is recognised that collective bargaining is the most effective way of bringing about wealth redistribution and this guidance should assist workers and their unions in seeking decent, fair and sustainable wage increases in 2022.”

The guidance on pay bargaining was issued on Monday, taking account of expected “strong and rapid” economic growth in 2022 due to a rise in personal consumption as pent-up demand increases and household savings unwind.

The projection assumes minimal disruption from Covid-19 restrictions.

The Central Bank and the European Commission project respectively that compensation per employee will increase by 4.8 per cent and 5 per cent. Meanwhile, Neri has projected that inflation will peak in the fourth quarter of 2021 before settling back to 2 per cent in the second half of 2022 and an average of close to 2 per cent after that.