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|ONLY TWO EU MEMBER STATES PLUS NORWAY SHOWED AN INCREASE IN REAL wages in 2011 according to the annual ‘Pay developments’ report compiled by the European Foundation for the Improvement of Living and Working Conditions (Eurofound). Although all the countries surveyed experienced a nominal rise in average salaries, the effect of price inflation meant that, in the Union, only the Czech Republic and Sweden saw living standards rise, by 0.8% and 0.3% respectively, while oil-rich Norway, not a member, recorded a 3% increase. At the other end of the league the United Kingdom experienced the biggest fall as a 1.8% agreed average pay rise was more then wiped out by inflation resulting in a fall of 2.6% in buying power; workers in Malta and Portugal also suffered a 2% or greater cut. Civil servants generally fared even worse with all the countries||
||except Sweden reporting lower rises than in the rest of the economy.
Some governments went much further than this however with pay freezes
in Cyprus, Estonia, Italy, Latvia, Lithuania, Spain and the UK in both
2010 and 2011. The civil service, and some of the wider public sector,
in troubled Greece and Ireland, as well as the first IMF victim Latvia,
was subjected to actual pay cuts, backdated in the case of Greece. In
the retail and manufacturing sectors (represented by the chemical
industry in the report) things were somewhat better. In Chemicals
increases ranged from 0.7% in Malta to 16.7% in Slovenia and were
usually higher in 2011 than in 2010. Negotiations in the retail sector
resulted in pay rises higher than over the whole economy in most
The Eurofound report predicts continued ‘very modest pay increases’ this year.
Average collectively agreed pay increase, in real terms, 2010 and 2011