NDU MEDIA RELEASE 15 July 2008:

Higher Wages Strategy To Move Retail Out Of Doledrums

The National Distribution Union says higher wages for low paid retail workers would help boost retail demand and sales.

“With 350,000 employees and most of them earning less than the basic wage benchmark of $15 an hour, retail employers are themselves helping to drive down demand,” says NDU National Secretary, Laila Harre,

“It’s the purchasing power of workers that will determine if the retail sector continues to decline or bounces back,” she said, “and the best way to boost that purchasing power is to boost the wages of low and moderate income earners.”

“What the sector needs is a good boost of retail ‘Keynesism’. Rather than rely on the Government to boost incomes through tax cuts or the Reserve Bank to do it with interest rate cuts the sector would be do well to share some of the record profits it has made during the retail boom with workers.”

Laila Harre said that too many retailers are paying bottom dollar – even though can and do pay more when their employees join the NDU and bargain a collective agreement.

“We consistently win pay rises of 5 to 15% when we bargain a first time collective. But employers are sitting on the mound of profits collected over the last few years for as long as they can get away with it. Bargaining wages up in retail will create pressures on other low-paying industries to do likewise and create the demand needed to end the recessionary trend,” said Laila Harre.

There will always be the short-sighted temptation for retailers to try and cut labour costs in a recession. However in the case of retail, this will just prolong the downturn. A strong wage surge will be a win-win for workers and retailers alike.”

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