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Wage handicap is melting away

7 November 2007

BRUSSELS – Belgian salaries seem to be getting slightly more in step with those in our neighbouring countries, a new report by the Central Board for Trade and Industry (CRB) shows. Belgian employers, however, do not agree.

Each year the CRB measures the evolution of labour costs as well as all the other factors that determine Belgium’s economic competitive position. This year, the report shows that labour costs in the private industry at the end of 2006 were 1.2 percent up on those in the Netherlands, France and Germany. By way of comparison, a previous estimate had indicated a 1.5-percent difference.

According to the CRB, the results are down to a number of tax measures for the industry introduced by Mr Verhofstadt and his purple government.

With the prospects of our neighbours’ wages increasing even slightly quicker by the end of 2008, the total picture is expected to look even better.

End of the wage handicap?
The CRB has calculated that the wage difference, also referred to as the wage handicap, should drop this year to 1.1 percent and even continue to melt to a mere 0.4 percent in the course of next year. The unions believe this may be the end of the wage handicap altogether but the employers think otherwise. They say our country is still dragging along serious arrears dating from before 1996 which have not been taken into account.

Next to that, the employers point to the uncertain evolution of inflation and wages in the coming months.

According to Belgian employers, the wage gap with our neighbouring countries is not very likely to drop to 0.4 percent. Instead, they believe it will more probably rise to 1.5 percent.

The employers criticise the CRB report, stating that it does not take into account the rising inflation and the collective labour agreements that have been made.

In their statement, the employer’s federation claims that “There are certain powers within the CRB that benefit from underestimating inflation”.

[Copyright Flanders news 2007]

Subject: Belgian news