Wages and Working Conditions in the Crisis

The economic and financial crisis of 2008–2010 has impacted on pay in most EU Member States leading to wage deceleration, pay freezes and sometimes pay cuts. The crisis hit vulnerable groups (low-skilled, young, migrants) particularly hard. Data from five key sectors (manufacturing, construction, accommodation and food services, financial services, public administration) reveal more crisis effects on employment than on wages. Cuts in low-paid and temporary jobs, or reductions in their hours, tended to be the first measure adopted while the ‘wage cushion’ often seen in higher-ranking jobs allowed cost savings through cuts in bonuses and other rewards. Cutting wages is also seen as detrimental to worker motivation and retention. Most responses taken were temporary with few trade-offs at company level between wages and other elements of the employment relationship. nrpages: 49 status: published