Ibec: Minimum wage hike will increase pressure on retail sector

Retailers will face renewed pressure if a further wage increase is implemented, Retail Ireland says
Retailers will face renewed pressure if a further wage increase is implemented, Retail Ireland says

Retail Ireland, a division of Ibec representing the retail sector, has warned of negative impact a Minimum Wage hike would have on the retail sector



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20 July 2016 | 0

Retail Ireland, the Ibec group which represents the retail sector, has expressed dismay at the recommendations of the Low Pay Commission to apply an increase to the National Minimum Wage. The latest recommendation follows closely the 6% hike which was applied at the beginning of this year. The group says that any further increase will increase pressure on retailers in a time of uncertainty for their industry.

“There is absolutely no economic bases for a further minimum wage increase,” said Thomas Burke, Retail Ireland’s director. “Following the 6% increase earlier this year, any additional rise will put further pressure on thousands of retail businesses that are already grappling with intense competitive pressures and a rising cost base.

“The UK vote to leave the EU has led to major sterling devaluation and raised the spectre of a return to cross-border shopping,” Burke said. “To further increase input costs for Irish retailers at this time will reduce our ability to compete with shops north of the border.

“The minimum wage is already higher than in the UK,” he continued, “and this gap will widen if sterling falls further – as it is expected to do.”

Meanwhile, Brendan Howlin TD took the opposite view, calling the 10c increase (which would bring the minimum wage to €9.25 per hour) inadequate, calling it “hardly enough to lift a family out of poverty”.

The Labour leader said in the Dáil that the hike in National Minimum Wage would do little to help a family already struggling to pay its bills.

“For a low paid worker,” he said, “[the new increase] amounts to just €200 a year, hardly enough to lift a family out of poverty.

“We expected a minimum wage rise to around €11.50c,” he said. “It’s very disappointing for the thousands of people on low pay.”


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