Workers in Ireland effectively took an almost 4 per cent pay cut in 2022 with wage growth lagging behind inflation, while pay packets for CEOs increased by more than a quarter, Oxfam has said.
Figures compiled by The Irish Times last summer showed that the average pay package of the 18 long-standing bosses of the largest Irish publicly quoted companies soared by 27 per cent to €3.46 million last year, as global equity markets hit record highs and corporate earnings surged.
At the same time, workers lost about €2,107 on average as generationally high inflation eroded their purchasing power, a report published by the charity to mark International Workers Day on Monday has found.
Faring worse than the global average, it means that workers in the Republic, in effect, worked an extra 8.3 days last year for free at a total loss to them in excess of €5 billion.
“We recognise that figures from any one point in time can be exceptional in some regard,” said Jim Clarken, chief executive of Oxfam Ireland. “But what we are highlighting is a very clear and alarming trend towards widening pay scales and resulting inequality across the globe.”
The figures tally with a report from the Organisation for Economic Co-operation and Development (OECD) last week that households in 2022 experienced one of the biggest erosions in living standards in the Republic since the 2008 financial crisis with real wages estimated to have decreased by 3.3 per cent.
Oxfam’s global study found that the top-paid chief executives across four countries – the US, the UK, South Africa and India – enjoyed a 9 per cent pay hike last year amid buoyant equities markets and rebounding demand. At the same time, workers in those countries saw their wages fall by close to 3.2 per cent as inflation soared across the globe.
In total, one billion workers in the 50 countries that Oxfam examined took an average pay cut of more than €624 in 2022, a collective loss of more than €679.6 billion.
Meanwhile, shareholder dividends hit a record $1.56 trillion (€1.42 billion) in 2022, Oxfam said, “a 10 per cent real-term growth compared to 2021. US corporations paid out $574 billon (€523 billion) to their shareholders, more than double US workers’ total real wage pay cut. Brazilian shareholders received $34 billion (€31 billion), just shy of what the country’s workers lost in real wages.”
Mr Clarken said the most alarming thing is the fact that efforts to reduce extreme poverty have come to a halt, with “wealth and extreme poverty having increased simultaneously for the first time in 25 years”.
“We urgently need greater taxation of the ultra-rich as a measure to fight inflation and inequality,” Mr Clarken said.
Oxfam is calling for a “national conversation in Ireland about taxing extreme wealth more, in effect,” Mr Clarken said, calling for “meaningful windfall taxes on excessive corporate profits” to be introduced immediately.
