We're paid more for doing less this year but don't feel richer
WE are earning more and working less than we were last year, according to surprising new figures from the Central Statistics Office.
They show that average weekly earnings increased by 1.1pc to €695 over the summer when compared to the same period last year.
Average hourly earnings are €22 compared to €21.58 recorded at the same point last year. But while we are earning more, we are working less, with the average number of hours coming in at 31.6 hours per week – it was 31.9 hours last summer.
The CSO does not give a reason for the decline, but many economists have reported that companies are cutting back on overtime as the economy continues to expand slowly.
While average salaries are rising, most of us will not feel any richer because higher VAT, other hidden taxes and inflation are all eating into spending power and disposable income. Employees have endured years of salary cuts. If present trends continue, wages are set to post their first annual rise since the recession began in 2008.
"After three quarters, it is now almost certain that 2012 will be the first positive year for average earnings' growth since the recession began," said Conall Mac Coille, an economist at Davy Stockbrokers.
"Today's data provide further evidence that positive earnings growth is now likely in 2013 despite high unemployment."
Yesterday's figures confirm that the pay gap between the private and public sector remains huge. Private sector workers earn just €617.94 weekly compared with €925.51 in the public sector. The gap is now at its widest since the third quarter of last year. And these figures do not include the gold-plated public sector pensions.
Public sector trade unions often argue their members should be paid more because they tend to be better educated than the general population.
The good news for private sector workers is that the gap is narrowing slightly as they enjoyed average increases of 1.6pc compared with just 0.9pc in the public sector.
The pay increases were fairly broadly spread, with eight of the 13 sectors monitored by the CSO reporting higher salaries. The biggest increases went to the professional, scientific and technical sector, which saw salaries rise by 8.4pc compared with the same period last year. Other decent gains were seen in construction, retail and financial services. Hotels and restaurant staff saw their pay fall by 5.1pc. Other areas to see significant pay declines included public administration, defence and the arts. The number employed in the public sector fell 4.1pc to 377,900 in the 12 months to the end of summer as the early retirement scheme kicked in. This takes the total reduction since the crisis began to 39,000.