EPMU on Wages

From the Herald:

The Engineering, Printing and Manufacturing Union yesterday warned it would further weaken the economy if the private sector followed Mr Key’s plan.

It would, in effect, cut wages and the union would continue to seek above-inflation pay increases to ensure its members didn’t bear the brunt of the recession.

National secretary Andrew Little said higher wages were a key element in avoiding a “vicious economic cycle”.

No, higher wages (without productivity gain) will lead to fewer businesses surviving and fewer jobs. So the EPMU is saying they would rather have less people in work.

There is no magical source of money for businesses.