Rutte calls for higher wages

Last Saturday, Premier Mark Rutte called for higher wages for employees. If not, companies could forget about the promised burden reduction. Economists respond surprised and sometimes even cynical to Rutte’s threat. Bas Jacobs, Sijbren Cnossen Professor of Public Economics at Erasmus School of Economics, sticks with ‘gratuit’.

Professor Bas Jacobs suggests that the Cabinet should increase the taxes for companies in order for the employees to save money. According to him, the reason why wages are lagging behind is ambiguous. On one hand it could be a disturbance of the labour market due to the growth of ‘zzp’ers’ and flexworkers. This makes it harder for labour unions to enforce pay raise. On the other hand an explanation could be that the unions are greyed-out and therefore more concerned about pensions than wages. Rutte promised improvement for everyone, which gives him a political interest in increasing wages.