Retail Ireland, the Ibec group that represents the retail sector, today expressed deep concern at the Low Pay Commission recommendation to increase the National Minimum Wage to €9.55 in 2018, an increase of €0.30. This is the third time in as many years that the Low Pay Commission have recommended an increase, and leads to a cumulative increase of over 10% since January 2016.
Retail Ireland Director Thomas Burke said: “With little to no inflation in consumer goods and growing concern over the impact Brexit is already having on the retail sector, there is absolutely no economic basis for a further increase to minimum wages. We are extremely disappointed that the Government have welcomed this recommendation of a further increase. Such a rise at this juncture would significantly affect retailers’ ability to remain competitive against a backdrop of falling prices and rising costs within the sector.
“This recommendation does not reflect the realities facing the Irish retail sector at present. Over the past twelve months, the performance of the retail sector has been mixed with a notable reduction in the pace of retail sales value growth since the UK’s decision to leave the EU. Continuing volatility in sterling has intensified pressure on retailers from competitors in Northern Ireland and UK based online retailers, and Irish retailers continue to cut prices to remain attractive to Irish shoppers. Allied to this, retailers have also had to contend with increases in other business costs such as rates and insurance.
"It is very concerning that while retailers continue to cut input costs in order to give consumers the lowest prices possible, Government controlled costs continue to rise. These rising costs are threatening the viability of retail businesses in Ireland, and are in turn jeopardising thousands of jobs in the sector."