“With the salaries offered by the private sector, it makes sense not to find employees.” This is a constant message from many listeners of the show “Show me the money” on the radio of POLITIS 107.6 every time we talk about the lack of staff in certain sectors of the economy. In other words, part of the public thinks that employers are just greedy, exploit the employee and prefer to be left without employees rather than “spoil” the market and offer higher wages. I think we all understand irrationality.
Yes, some, perhaps many employers, become greedy when there is an oversupply of workers. But with unemployment at 3.6% and full-time conditions out there, it does not take any employer to “stand on its own two feet” and refuse wage increases. In fact, at a time when the cost of living is rising and not only are the increases justified but in many cases they are imposed. Since, therefore, the restraint in salaries is not due to the “greed” of the small family businesses of the country, then it is clearly their inability to meet even higher costs. A weakness that is the result of market distortions from the interests of subgroups of the private and public sector, the high operating costs, the reduced competitiveness of the economy, but also the unfair competition caused by “zombie” companies that do not say to close and “eat” »Market share by healthy businesses. That's all we have to see.
The Cypriot economy has always had distortions. Defending the “acquis” of various professional teams causes costs and unfortunately these teams are many and powerful. From the “mukhtari” that certifies, to the lawyer who signs the application that you prepared, but also the overcrowded but permanently understaffed public sector, there is a cost that citizens and businesses, either pay directly or indirectly with taxation. At the same time, business operating costs have skyrocketed. The protection of interests in the electricity market did not help, but the timeless refusal of inactive real estate tax sent housing costs to the level of large European cities. These are inelastic costs that “strangle” businesses and “cut” wages.
At the same time, the competitiveness of the Cypriot economy remains problematic. It is not only the small size and the Turkish occupation that deprive us of our competitiveness. It is also justice that can not be rendered in time. It is also the digitization that is not progressing as fast as we would like, it is also the resistance of groups of the population to the real and substantial reforms, but they believe that they will spoil their comfort. However, in recent years, and especially in the pandemic, “zombie” companies have been added to the distortions. These are companies that should have already closed but managed to survive the reckless borrowing that was done in the past and remain on the “respirator” through the tolerance of the state. Businesses that can not give good wages, causing distortions in the labor market. However, the fact that they are still in operation, even marginally, detracts from the dynamics of health companies, as they take a significant part of the market and infect the entire economy.
So long as we do not look at the real causes of low wages, no basic wages will save our personal finances and no help from the EU will save our state from impending crises. Those who really want to see wages rise should insist on taxes that will prevent the “savvy” from stacking wealth on dormant real estate, increasing costs for others. Do not tolerate the unnecessary expenses left over from the practices of previous times, no matter how big or small, and do not allow the perpetuation of behaviors that cost time and money to the State and to individuals. To stop the state from defending or tolerating “zombie” operations, in the hope that this is how we will end them before it is too late. That is, to do what the other states do not have our own problems.
