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Prosperous 2014: Wages to reduce further in Greek private sector

The incomes of employees in Greece’s private sector are expected to undergo a further reduction at 1.5%. And this although wages fell at 21.7% during the last three years, after Greece surrendered to the Troika bailout mechanism. But of, course and in contrast employees at the Greek public sector and utility companies have not suffered the same income losses.

This grim perspective for the new year comes from Bank of Greece’s report published yesterday:

“In 2014, the average gross earnings in the whole economy will be reduced by 1.5 % . Indeed, the cumulative reduction within three years reached 21.7 % . This means that the labor cost in Greece fell more than foreseen in the second Memorandum of Understanding, i.e. the loan agreement with the Troika. The income reduction in 2014 even though at a slower pace than during the last two years .

According to estimations, from the end of 2011 until today the salary reductions through operational and individual contracts (abolishing of collective bargains) fell at least 28.7 % for employees in the business sector , while incomes underwent a further reductions due to conversion of full0time work to part-time or job rotation.

However , the Bank of Greece expects 2014 the average working time in the private sector , which declined as of 2008 , may begin to grow gradually , reflecting the slightly faster growth in productivity , as the economy will begin to recover.

The report also states that the decline in prices due to the recession ( deflation ) has a positive side as it mitigates the reduction of real disposable income, but it is not desirable to continue with intensity for a long time, as it adds uncertainty in the economy and business expectations , while it worsens the debt dynamics.” (via protohema)

In real life, the further 1.5% will mean that families’ monthly income could be reduced from 650 euro net to 640,25 euro, just to name an example where in a family of four, only the father has a part-time job. No to mention that with this monthly income, not even the basic needs (rent, food, utilities, heating etc) of the family are being covered.

I was reading yesterday in daily Eleftherotypia about the hourly payment for actors: whole €3.25 per hour. With the abolish of collective bargain participation in the probes will not be paid.  Therefore in order to get one single social security stamp they will have to participate to four theater performances per month. In order to get insurance, one needs at least 50 stamps. Unemployment in the sector is at 95%.

No, we don’t need culture in times of crisis, even though PM Samaras had served as minister of culture….

PS and I had thought that the year 2013 would have be the worst of the economic crisis.

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