Tuesday, January 13, 2009

Pay cuts

One reason I believed that being part of the euro is such a problem is because I never believed that workers would accept pay cuts. Pay cuts - for both private and public sector employees - are the only real mechanism available to us to try to regain competitiveness, particularly with regards to the UK. If the public and private sector workers - unionized or not - are willing to accept significant pay cuts, say back to 2006 levels, then I think we can survive membership in the euro.