Private sector unions in the Republic of Ireland are to pursue pay rises in 2018 that will compensate for the “excessive costs” of housing, childcare and pensions.
In advice on pay bargaining for 2018, the Irish Congress of Trade Unions (ICTU) – the sole union federation on the island of Ireland – recommends that unions in the private sector seek a minimum pay increase of 3.1% for 2018 to “take account of normal productivity and cost of living factors”.
However, Congress also advises unions representing private sector workers that, where appropriate, they should seek compensation for the high and excessive costs that people are having to pay for housing (rental and purchase), childcare and pension provisions.
Public service workers in Ireland are covered by a separate agreement on pay and conditions that applies across the sector.
“We have repeatedly informed government that the high cost of housing and childcare currently being faced by workers, is unacceptable,” said ICTU General Secretary Patricia King. “Quite literally, young workers on average wages can no longer afford to purchase or rent homes close to where they work and are additionally punished if they have a family. This is politically, economically and socially unsustainable.”
In its advisory note to unions, the ICTU points to findings from the the Nevin Economic Research Institute showing that workers in Ireland face the second highest childcare costs in the OECD and many workers on average incomes now struggle to buy or rent homes across the country.
House prices and rents have risen by far more than incomes since 2012, making it difficult for workers to find affordable homes. Ireland is currently experiencing a major housing and homeless crisis, which has seen rents rise by an average of 60% nationally and house prices by up to 40%, while disposable incomes have risen by just 8% in the same timeframe.
In some large urban areas, such as Dublin, housing costs can account for up to 47% of total essential expenditure. There is nowhere in the Dublin area where two full-time minimum wage workers could hope to raise a family without state support and very few places in Ireland where they could even hope to buy a home. The cost of a one-bed apartment in parts of Dublin is almost eight times the median wage for a worker under the age of 35, while at least 50% of older workers (over age 35) could not afford to buy a home in Cork, Ireland’s second largest city, on their current salary.
Research also shows clear regional disparities in the cost of childcare with prices in Dublin far above the rest. Paying for full-time childcare for one child in Fingal – part of the Dublin region – consumes about 40% of the take-home pay of the median employee aged 25-34, and the cost of two children anywhere in Dublin is more than the take-home pay of a full-time minimum wage worker.
The ICTU has repeatedly warned the government that if it failed to deal with the housing crisis and housing costs at a national level, unions would pursue compensation at workplace level. Congress has called for an emergency programme of public housing construction of up to 10,000 homes per annum, over the next five years.