Stats for Socialists: Wages and Inflation

The government argues that wages should decline in value, because if they don’t, prices will go up.

There are six countries in the EU that have a system whereby wages are automatically increased to catch up with inflation every six months.

Their inflation rates in July were no worse than those in comparable countries.

Indexed countries in capitals

Looking at neighbouring countries, we can see here that Belgium, where the employers have a campaign to get rid of indexation as “unsupportable”, has a lower inflation rate than The Netherlands, which doesn’t have it, Slovenia, which has indexation, has a lower rate of inflation than Croatia, which does not.

And the UK has a higher rate of inflation than five out of six of the indexed countries, with only Slovenia being higher.

Workers are the victims of inflation, not the cause.