Unions want $21 a week pay rise, Qantas denies job cuts, market opens lower: Economy roundup

Trade unions are seeking a $21 a week pay rise for over one million workers on minimum wages, and reject calls for wage freezes.

Australian Council of Trade Unions secretary Jeff Lawrence has said today that the increase will help protect jobs by enabling families to stimulate the economy.

“The ACTU urges the Fair Pay Commission to reject recent calls by employer lobby groups for a wage freeze, which would mean further real pay cuts,” Lawrence said. 

But the National Retailers Association has urged the Fair Pay commission not to increase the minimum wage, saying it would result in higher unemployment and would hurt business viability.

Victoria Trades Hall Council secretary Brian Boyd said workers will not accept wage freezes, and that the commission should keep wages in line with inflation. The minimum wage is currently $543.78 per week, after a rise of $21.66 per week last year.

Meanwhile, Pacific Brands chief executive Sue Morphet has said Australian consumers are also to blame for the sacking of 1850 workers at its manufacturing facilities last month.

“Long, long gone are the days when Australians are actually prepared to pay more for Australian-made goods,” Morphet told 60 Minutes.

“The only time that we’ll pay for Australian goods is if they are giving us something that buying elsewhere or cheaper isn’t giving us.”

But she claims the decision to sack workers was not an easy one. “Sleepless nights, nervousness, anxiety. All of the things that you would expect exist,” she said, but added the move will make Pacific Brands a stronger company.

Qantas is remaining quiet on whether the airline is preparing to cut 100 senior executive jobs. Spokesman Simon Rushton has told AAP that the company will not comment on any restructuring plans.

The rumours are due to a report in The Australian Financial Review today that the company is preparing to cut the jobs, but Rushton has replied that “it’s a speculative story, as they so often are, and there is a lot of padding in that story”.

The Australian sharemarket has opened slightly lower today after negative leads from Wall Street late last week, but has rallied during the morning. The benchmark S&P/ASX200 index was up 33.8 or 0.98% to 3499.6 at 11.50 AESDT.

The Australian dollar also opened at 10-week high at just under $US69 cents.

ANZ shares have gained 2.4% to $14.90, while Wesfarmers gained 2.3% to $18.44. Westpac jumped 1.5% to $18.45, as Commonwealth Bank lost 0.4% to $33.88.

Overseas, Wall Street is bracing for an anxious week as the Treasury Department prepares to reveal its bank rescue plan. The trillion-dollar plan to help reduce toxic debt has been described by President Barack Obama as necessary to help stop financial institutions from imploding.

“If we did nothing you could still have some big problems. There are certain institutions that are so big that if they fail, they bring a lot of other financial institutions down with them,” he said on 60 Minutes.

Obama says he was surprised at how fast unemployment had risen during his two months in office. 

“I mean if you look at just … hundreds of thousands, now millions of jobs being shed over the course of two months, or three months –  that slope is a lot steeper than anything we’ve …seen before,” he said.

The financial woes have continued even at home, with Prime Minister Kevin Rudd saying it is impossible for Australia to avoid a recession.

“It’s clear that the impact of a worsening economic global recession will make it virtually impossible for Australia to sustain a positive economic growth for the period ahead,” he said on the Nine Network yesterday.

The comments come as Rudd leaves today to meet with President Obama ahead of the G20 summit.