RPI

C_steam · 07-03-2006, 07:37 PM

This years annual wage round is in progress at my place of workship, every year we look at various indicators and the comparators in the industry before discussing a settlement figure.

Every year we have used RPI as one indicator - in this case to show inflation.

For the very first time we have hit a problem - the shopfloor (probably rightly!) do not feel that the RPI figure really represents the increases they have felt in their pocket this year. They do not trust the 'inflation' information the gov is putting out.

Interesting eh?

BASILDON BOY · 07-03-2006, 07:47 PM

The RPI has been distorted this year by the big dollop of cheap minimum wage Labour that entered the UK last year.

While we can all see the rise in prices. Inflation has been kept artificially low becasue the wages used in the calculation have been distorted.

If you as an employer had a choice between paying skilled 'native' labour at £20 per hour - or Polish minimum wage labour at £5 per hour - which would you choose???

Because so much very cheap Labour is being used throughout the UK replacing the high pay of us mere 'natives' it has had an effect of distorting the RPI and inflation thus the figures can not be trusted.

Perhaps my conclusion is wrong but scratch below the surface of how the figures are compiled.

07-03-2006, 07:37 PM	#1 (permalink)
C_steam Super Moderator Join Date: Oct 2004 Location: Paddling up 5hit creek..... Posts: 7,704	RPI This years annual wage round is in progress at my place of workship, every year we look at various indicators and the comparators in the industry before discussing a settlement figure. Every year we have used RPI as one indicator - in this case to show inflation. For the very first time we have hit a problem - the shopfloor (probably rightly!) do not feel that the RPI figure really represents the increases they have felt in their pocket this year. They do not trust the 'inflation' information the gov is putting out. Interesting eh?

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07-03-2006, 07:47 PM	#2 (permalink)
BASILDON BOY Senior Member Join Date: May 2005 Location: N'Djamena, Chad Posts: 1,799	The RPI has been distorted this year by the big dollop of cheap minimum wage Labour that entered the UK last year. While we can all see the rise in prices. Inflation has been kept artificially low becasue the wages used in the calculation have been distorted. If you as an employer had a choice between paying skilled 'native' labour at £20 per hour - or Polish minimum wage labour at £5 per hour - which would you choose??? Because so much very cheap Labour is being used throughout the UK replacing the high pay of us mere 'natives' it has had an effect of distorting the RPI and inflation thus the figures can not be trusted. Perhaps my conclusion is wrong but scratch below the surface of how the figures are compiled.