Unions in New Caledonia have secured a 4.2 percent increase of the lowest salaries from January 1, 2023.

The concession by the employers’ organisation MEDEF was announced as a large crowd rallied for a general strike outside its offices in Noumea.

According to police, 1500 people had gathered to press their demands while the unions said they mobilised 5000 members.

The unions had sought an across-the-board pay increase of six percent in the private sector to offset the impact of inflation, which in November was 4.4 percent.

The wage hike applies to those earning between the monthly US$1440 minimum pay and those earning up to US$1775.

MEDEF said inflation has hit businesses hard as production costs are rising faster than product prices, in particular with the rise in the cost of energy.

MEDEF said the social partners became aware early on of the negative impact of imported inflation on the purchasing power of New Caledonians.

It said that as early as May it and the unions unanimously and jointly asked the government to hold a conference on wages.

MEDEF said since April there had been proposals for tax reform which combined economic recovery and resetting of net wages.

It said raising wages had therefore always been a key aspect of the planned tax reform.

The government plans to hold a conference next week to discuss reforms in view of the crisis facing public finances.

This article is republished under a community partnership agreement with RNZ. 

Article by AsiaPacificReport.nz

As the public (and many economists) see it, economic growth (growth of Real GDP; marketed economic output) is the principal economic goal of a nation state. Some economists hold a (slightly) more nuanced view – for them it is productivity growth that matters – but when pressed they cannot conceive of productivity growth without economic growth.

This nuance is important. Inputs are costs – including labour inputs – and outputs are benefits. This is true, by definition. And it is the central axiom of economics. Thus labour productivity growth is beneficial, by definition, because benefits (outputs) are growing faster than costs (labour inputs).

Labour productivity growth can come about according to five scenarios. Before considering these, however, we need to note that both measures of labour inputs and economic outputs are contested. It is good to have contested measures, preferably sitting alongside each other. One measure should not displace others.

Contested output concepts:

• Real GDP, a measure of marketed outputs, reflecting purchased goods and services.
• A wider measure, that includes outputs that are not for sale, and that deducts for harm created in the production or consumption of those outputs.

Contested labour input measures:

• Hours of available labour, where labour means paid work.
• Hours of labour worked, again where labour means paid work.
• Hours of work performed, where work means any hour that contributes to the wider measure of output.

This month’s chart uses the underlined output and input measures: Real GDP and Hours of Labour Worked.

Using these measures, labour productivity growth may mean either of the following scenarios (or types):

1. Real GDP increasing, and Hours of Labour Worked increasing; GDP increasing faster.
2. Real GDP increasing, and Hours of Labour Worked static.
3. Real GDP increasing, and Hours of Labour Worked decreasing.
4. Real GDP static, and Hours of Labour Worked decreasing.
5. Real GDP decreasing, and Hours of Labour Worked decreasing; Labour decreasing faster.

All five of these productivity growth types represent successful economic outcomes, to an economist. Although, as noted, economists struggle with type 5, which is very much a leisure-preference version.

Most of the public – and most economists – and most elected politicians – strongly favour only the first of these five productivity possibilities. The reason for this is that most of us – possibly even most economists (despite their disciplinary training) – think of Hours of Labour Worked as a benefit rather than as a cost. It’s even enshrined in the Reserve Bank Act – through the most recent Policy Targets Agreement – that it is an economic goal to maximise employment. (Maximising employment is quite different from minimising unemployment, though some people assume that the two are the same.)

Looking at our chart, we see that, for the most part, outputs (dark blue) have been growing faster than labour inputs (light red),with both growing. That’s the productivity growth most economists expect to see. All the periods of negative growth of worked labour are periods of recession or near-recession, when the problem was largely unemployment; high levels of unutilised but available labour.

The public is used to thinking that economic times are good when both blue and red are growing faster than two‑percent per year. Indeed some even think that employment growth (costs) is more important than output growth (benefits). Indeed, this decade, this new unproductivity phenomenon has emerged.

For about half the time the rate of increase of paid labour has exceeded the rate of real GDP growth. In the popular view – that Hours of Labour Worked is a benefit rather than a cost – this looks peculiarly successful. To most economists (with their economist hats on), it’s appalling; since 2012 average productivity growth looks negative.

There are two important messages here to take with us into the 2020s. First – in conventional terms – we are entering unfamiliar territory. This is the non‑productivity growth variant of Productivity Type 1. The last decade of low growth, low inflation and low unemployment was the 1920s; it’s time we learned more about that decade. That’s one message.

The second message is for us to ask how we can move from Productivity Type 1 to any of the other more sustainable productivity scenarios. There are only two ways we can do it without unacceptable levels of inequality.

First, there’s the Japanese way, which is to use debt to fund consumption of the output that is growing when the labour inputs are shrinking. Inequality – and systemic bankruptcies – can be avoided if the government becomes the indebted spending sector, and the government’s creditors are domestic rather than foreign.

Second, societies may distribute capital income – social profit – to all, so that people can spend in excess of their labour wages without incurring excessive household debt. That means a Universal Basic Income (UBI), or at least a system of Public Equity Dividends. A UBI is compatible with all five productivity types.

A sustainable economic future means enabling the possibility of switching away from Productivity Scenario 1 (and its emerging non‑productivity counterpart, as seen from 2012 in the chart). This future can only exist with increasing public debt or increasing public equity or both. The most acceptable future – think Productivity Scenario 4 – requires a full acknowledgement of public equity to be incorporated into capitalist economic thought.

The solution is not to replace traditional measures; GDP will always be an important economic measure, sitting alongside measures that focus on wellbeing rather than marketed output. My conclusion that public equity is a prerequisite to sustainable wellbeing applies, whatever measures we adopt for economic output, and labour input.

This month’s chart uses a correctly proportioned (logarithmic) scale to compare the growth of the average hourly price of labour in Education/Training and miscellaneous Professional Services with wage growth across ‘all industries’ (bearing in mind that most workers are employed in service ‘industries’).

We should relate this to my June Chart (The Future of Work?) and commentary, and with David Graeber’s analysis in mind (Why bullshit jobs are booming [Radio New Zealand], and On the Phenomenon of Bullshit Jobs [Strike, 2013]). We note in particular that, while ‘bullshit jobs’ can be found in all industries – and there are signs that employment in many service occupations is being subject to a process of bullshitisation – Graeber’s bullshit jobs are heavily concentrated in the rapidly growing ‘Professional, Scientific, Technical, Administrative and Support Services’ industry. (This is the PSTAS – or ‘pissed as’ – sector.)

In this month’s chart, we see gridlines labelled ‘500’ and ‘1000’. The ‘1000’ represents a doubling of nominal (ie not inflation-adjusted) hourly earnings. Thus we can see that average hourly earnings doubled between 1989 and 2010. Likewise, they doubled between 1995 and 2018. (The increase from one gridline to the next is about 26 percent. Three gridlines represent a 100% compounded increase.)

In education, hourly wages barely grew in the early 1990s – the years of Ruthanasia, which culminated in the passing of 1994 Fiscal Responsibility Act. Public sector expenditure was ruthlessly (or ‘Ruthfully’?) suppressed at a time when official unemployment reached 11 percent and actual unemployment was double that. However, education wages did catch up in the decade after 1995 – the decade in which the international education industry grew very rapidly in New Zealand.

It was after 2009 that education wages started to fall behind again. In a couple of years in the middle of this decade, education wage growth was basically nil while some PSTAS workers experienced large earnings’ increases.

It is certainly true that education workers need a pay catch-up, and by more than the chart suggests.

Average hourly earnings is influenced by the average experience in the teaching workforce, and by the changing mix between teaching and management staff. As the teaching profession has aged, teachers’ average hourly wages have increased by much more than new-teacher wage rates. (The opposite applies to PSTAS remuneration, as the many new entrants bring down the industry average.)

Further, many people employed in the last five years within the education industry have been managers on six-figure salaries (many doing jobs that fit Graeber’s definition of “bullshit jobs” – jobs the performance of which does not augment social or economic well-being). The industry average earnings growth will have overstated the earnings’ growth of teachers, especially during the 2016 wage spurt.

One of the biggest problems that teachers face was well expressed in the well-received (in Australia) ABC Teaching Special Q+A television program (8 October 2018; downloadable; transcript available) was ‘demoralisation’. Demoralisation relates to incremental though persistent increases in the (essentially bureaucratic) non-teaching workload that teachers face (as in ‘if the students would only go away I would be able to do the work I am required to prioritise’). Essentially this unnecessary work overload is the ‘bullshitisation’ of the teaching profession, and is the deep underlying cause of teachers’ frustration.

More-and-more of teachers’ work is coming to resemble the work done in ‘bullshit jobs’. It means teachers are doing evermore work in total; overtime work they are not getting paid for. If we divide teachers’ salaries by the actual amounts of work they are expected to do, then the average hourly rate of teacher remuneration has been falling. Economists would say that the increased underpricing of teachers’ labour is the root cause of the shortage of teachers and trainee teachers. Add in excessive housing costs, and you have a profession in crisis. This is not a crisis that can be resolved through willful ignorance.

Pacific Media Watch Newsdesk

National District Governor Powes Parkop has pledged that it will be business as usual today in the Papua New Guinean capital of Port Moresby as normalcy has been restored in the city after yesterday’s rioting, looting and an assault on Parliament.

Parkop declared this after meeting members of the Security Force, together with National Parliament Speaker Job Pomat, Minister for Finance James Marape, Minister for Police Jelta Wong, and other ministers yesterday afternoon at Sir John Guise Stadium in Waigani, reports Loop PNG.

Security forces protested over the lack of payment of security allowances for the Asia Pacific Economic Cooperation (APEC) leaders summit last week by storming Parliament Haus in Waigani and causing damage.

READ MORE: Army ‘not involved’ in storming of PNG Parliament

Port Moresby looting captured by Camara Geita on Twitter yesterday. Image: PMC screenshot

This triggered off rioting in parts of the city and looting in shops.

“Government has agreed to settle the allowances as soon as possible and we all agreed to return to duties to restore calm and normalcy to the city with immediate effect!”

Parkop said the issue of allowances for officers providing security during the APEC meeting is being resolved by the national government and relevant agencies.

He said that K10 million (NZ4.4 million) was released yesterday and was being processed to be disbursed as soon as possible.

A live feed fof shooting, looting and rioting in Port Moresby yesterday. Video: Camara Geita/Twitter

‘Purely administrative’
“This is a matter that is purely administrative.

“Schools should return to normal, shops should open and offices and business should operate as normal instantly. There is no cause for concern or worry.

“I call on everyone not to rely on rumours and fake news to cause an alarm and incite fear unnecessarily.

“The event was regrettable but it’s under control and there is no reason to be fearful anymore.”

Yesterday, business houses, schools and shops closed early due to the looting that occurred at different parts of the city, reports EMTV News.

This followed the rampage at the Parliament by frustrated Joint Security Task Force members over the non-payment of their APEC allowance.

The APEC pay dispute and why the PNG police protested. Video: EMTV News

Article by AsiaPacificReport.nz

By RNZ Pacific

Hundreds of Papua New Guinea police have descended on Parliament Haus in the Port Moresby suburb of Waigani demanding payments they say they are owed for providing security at last weekend’s APEC leaders summit.

RNZ Pacific’s correspondent in PNG, Melvin Levongo, said multiple police vehicles with armed police were involved.

He said police were demanding to speak with Prime Minister Peter O’Neill and APEC Minister Justin Tkatchencko about the extra allowances they were owed.

READ MORE: Reporters attacked as security forces move into Parliament Haus

Levongo said a policeman told him they were very angry at the government.

“You guys have got money to purchase Maserati cars but we are asking for our allowance, so that’s the situation currently at the moment,” he said.

-Partners-

Levongo said traffic had been halted in and around Parliament Haus, and that there was no military involvement in the protest.

Photographs are circulating on social media showing damage at Parliament Haus, including broken glass windows and doors for which PNG police are said to be responsible.

Opposition Madang MP Bryan Kramer’s Facebook page shows hallways and lobbies that have been trashed and an image of startled shadow ministers whose meeting was interrupted.

This article is republished under the Pacific Media Centre’s content partnership with Radio New Zealand.

PNG security forces on guard at Parliament Haus in Waigani today. Image: Brian Kramer FB Opposition Madang MP Bryan Kramer speaking in a live Facebook feed about today’s protest at Parliament Haus. Image: Bryan Kramer FB

Article by AsiaPacificReport.nz

By Richard M. Nanua in Port Vila

Some Vanuatu police officers have raised dissatisfaction on the implementation of the Government Remuneration Tribunal (GRT) ruling taking effect today, claiming it might negatively impact on security in the country.

After receiving a letter from the Police Commissioner, Albert Nalpini this week, police officers (lower ranking officers who did not want their names revealed) said they had all entitlements – such as detective, driver, prosecutor and sergeant allowances – removed with an increase that did not make any difference in their wages.

The unhappy police officers said that in their letters from the Commissioner, he had said the GRT report made a major determination that covered sworn police officers (Determination 15 of 2017).

The result of Determination 15 would be an overall increase in salary of VPF members to reflect market rates and to recognise the complexities and unique nature of policing work, they were told.

The determination also required that job-related allowances (JRAs) and take-home entitlements be incorporated into salary and no longer paid as a separate entitlement.

The GRT determination established that any salary adjustment would be in accordance with performance guidelines and budget availability.

-Partners-

The review of the salary increments would occur every three years rather than annually as in the previous situation.

‘Take-home pay’
The police force allowances that GRT has decided to remove are job-related allowances and other “take-home pay entitlements” that are to be absorbed into the revised salary rates.

But some police officers said that according to the new structure, the job related allowances – including the detective allowance, drivers allowance, instructor allowance, musician allowance, prosecutors allowance, tradesmen’s allowance, traffic examiners allowance, and sergeant allowance – had been wiped out from their entitlements.

They said that the take-home pay entitlements that were also taken from them are child allowances and housing allowances.

They are concerned that some of them will be affected with the change, especially the lowest paid in the force.

They said the senior police officers would benefit from the new structure but it was “a disaster” for police constables and the lowest ranks within the VPF.

Some of the police said that they had “put their lives on the line” every day for citizens.

They said that they were risking their lives for civilians who they did not even know they were attending dangerous situations.

Drug, murder cases
They deal with drug cases and burglars, rapists and murderers.

They get assaulted by criminals in what was a hard and dangerous job.

When the Daily Post gauged the view of some members of the public in town for their view, they appealed for a significant increase on the police wages.

Meanwhile, Internal Affairs Minister Andrew Napuat said he had reminded Commissioner Nalpini more than three times and Commander South, Jackson Noal, of any issue that may arise on the beginning of GRT pay that commences today.

The minister said he welcomed comments and anyone who was affected by the GRT, claiming if there was any dissatisfaction caused by that new structure then it was a top priority to deal with it.

He encouraged the unhappy police officers to talk to their superiors or to step into his office.

School teachers told the Daily Post yesterday that they were also affected.

They said that GRT was likely to affect teaching not only in Port Vila but Vanuatu as a whole.

The teachers said none of them were happy with this new structure that was only benefitting senior officers.

They appealed to the government to revisit or “hold” GRT pending a wider consultation.

Richard M. Nanua is a Vanuatu Daily Post journalist. Asia Pacific Report republishes VDP stories with permission.

Article by AsiaPacificReport.nz