Workers require at least 25% wage increase across the board to even start to reduce the gap between wages and high salaries.
Average wages after tax.
The average British family in 2002 was left with an average of £24,407 in “disposable” income in 2008/09.
Income in the top and bottom fifth of households was £73,800 and £5,000 respectively before taxes and benefits. Even so the averages take into account many higher earning mangers whose income raises the average. The minimum wage, which many workers have to take home, currently is
• £6.08 – the main rate for workers aged 21 and over
• £4.98 – the 18-20 rate
• £3.68 – the 16-17 rate for workers above school leaving age but under 18
• £2.60 – the apprentice rate, for apprentices under 19 or 19 or over and in the first year of their apprenticeship
If you are of compulsory school age you are not entitled to the (National Minimum Wage) NMW. Some of your other employment rights are also different. This cannot even be called disposable income. In national accounts definitions, personal income, minus personal equals disposable personal income
At the main rate for 40 hours is 6.08 x 40 = 243.20 per week x 52 = £12,646.40p per annum. These workers would require 100% increase just to close the gap on the current average wage as indicated above, and that is wages before tax.
A 300% increase would be required to close the gap between average income earners and the top earners of £73,800 per annum. 24,407 x 3 = £73,231
There were over 619,000 net worth Sterling millionaires in Britain in 2011, and 383,000 dollar millionaires (financial assets only) in 2004. According to the March 7th, 2008 edition of the Daily Mail there are 48 billionaires (35 are British) living here, making the UK Europe’s super-rich capital.
Workers on or below the average wage described will require a 25% increase immediately plus inflation (The current Retail Price Index for 2012 is running at 2.8%) to raise standards ongoing and increased further to close the gap with the highest earnings. If this does not occur standards will drop and the majority of wage earners will become impoverished.
Currently the basic State Retirement Pension for a single person is £95.25 and £152.30 or a couple. 95.25 x 52 = £18,317 per annum. This means that a single person relying totally on the state pension would need a 50% increase to catch up with average earnings.
Pursuing a wage claim
Workers cannot accept the view that they must accept below inflation wage increases. To accept low wages can only mean that the workers should accept lower living standards as prices have continued to rise. The gap between rich and poor essentially means that the claim on the social product is disproportionate and the first claim is going to the monopolies, the second claim is going to the government in taxes and military state expenditure on wars is increased. The minority claim is wages and this is topsy – turvy. The claim against profits should not go first to shareholders and their pockets. The first claim on production should go to the workers who produce the wealth.
Even on the most basic necessities the workers cannot compete very well in purchasing commodities. The price of foodstuffs is kept high because of the demand passing mainly to the rich. The price of fuel is also kept high as more and more demand switches from the poor to the rich. Demand from the wealthier sections compared to the poorest is greater as you go up the classes in society. We see the extravagance and waste increasing at the top where the bottom of the pile is finding it hard to obtain enough to eat.
There is a view that it is not possible to pursue even the smallest wage claim when there is austerity and crisis. It is also said that the employers will not accept or “give in” to high wage demands. Both of these notions are false. Wage claims are not made based on the whether the economy is up or down. Wages do not affecting the economy up or down in this way. This is due to the fact that balancing wages and salaries between the rich and poor does not lead to excesses in expenditure but on balancing claims against the social product. Wages only affect the amount of the proportion of surplus created out of adding value that goes to the employing class instead of the working class. This goes against any notion that workers and their wages are a cost. In fact the reality is that an increase in workers’ wages changes from a general waste of the surplus created by added value and shifts towards worker spending power in the economy that generally improves the supply and demand of the economy. The notion that the employers and their governments will not accept higher wage demands misrepresents the fact that the capitalist class does not accept any wage increase that affects profits at all. This puts the notion of “acceptance” out of any equation. Whatever is agreed to contractually or otherwise conceded is either through negotiation or through force. The united workers make a claim, and that claim is only conceded when the employers give in to the demands. It is the power of workers organisation and their conscious pursuing of the demand to the end that makes any gains.