Iceland’s labour market is under a riotous spell. Workers are
unhappy with their wage agreements. In the past six years, collective
agreements have only led to a rise in the minimum wage. It now
stands at 201,000 Icelandic kronor (€1,350) a month.
Private sector workers with no vocational training are demanding a
monthly minimum wage of at least 300,000 Icelandic kronor (€2,000).
That would mean a 30 percent pay increase.
Academics in the public sector are demanding that employers reward
an education so that it will pay to go to university. They also demand
local wage agreements between unions and authorities, according to the
deputy leader for Iceland’s Association of Academics (BHM), Páll
Halldórsson.
Not enough
The workforce has run out of patience. There has been strike action
since 20 April. There are negotiations, but a general strike will take
place in early June if the negotiating parties fail to reach an
agreement. Employers have offered a 12 percent pay increase over the
next three years. The trade unions say this is not enough.
But Iceland’s Minister of Finance Bjarni Benediktsson has told
Icelandic media that the workers’ demands are completely unrealistic.
Iceland has been fighting inflation for several years. The Minister of
Finance says inflation would rise quickly if salaries were to be
increased by 30 percent now. He says this would mean the return of
Iceland’s economic problems.
Surprised employers
The deputy leader for the Confederation of Icelandic Employers,
Hannes G. Sigurðsson, agrees. He is surprised by the workers’ high
demands and believes this will make it even harder for the parties to
reach an agreement.
“I am also surprised that we have managed to get good results when
it comes to reducing prices and improving the purchasing power in
recent agreements,” says Hannes G. Sigurðsson.
He believes most people have lost their patience and does not rule
out that the economic crash plays a role in what is
happening.
“Workers have been encouraged to believe it is possible to increase
salaries so much without causing a negative effect on prices and the
economic balance in Iceland,” he says.
Better to stay put
The strikes are having an impact already. There is reduced capacity
at the Landspítalinn university hospital. The hospital management is
talking about lives being put at risk, that patients are not receiving
proper care.
The strikes are also being felt elsewhere. There is a lack of fresh
meat in shops because pork and poultry abattoir shipments have been
halted. Veterinarians have been striking for over four weeks
already.
“The salary and employment conditions are bad. As a vet I receive
the same salary now as I had when I worked as a cleaner in Denmark
while I was studying for my veterinary degree eight years ago,” says
district veterinarian Jón Kolbeinn Jónsson who lives in North-western
Iceland.
He is wondering whether it would have been better to stay in Iceland
rather than going to study in Denmark. Jón Kolbeinn is unhappy that he
has been forced to stop working. Farmers can continue producing and
sending animals to abattoirs.
“There is a lot of discontent among veterinarians. They would like
to negotiate, but the state never comes up with any solutions to the
conflict,” says Jón Kolbeinn Jónsson.
Working day and night
Jón Kolbeinn’s colleague in North-western Iceland, inspection
veterinarian Einar Otti Gudmundsson, says veterinarian wages have been
trailing while working hours have increased in recent years. He says
many of his colleagues need to work day and night in order to survive
on the current wages.
There is a lack of veterinarians in rural areas of Iceland. They are
not interested in working in the countryside because of the poor
working terms. Jón Kolbeinn and Einar Otti fears veterinarians will
move abroad. Icelanders study to become veterinarians in Denmark,
Norway, Hungary, Slovenia and Scotland. They are offered good jobs
abroad, especially those who have just finished their education.
“Veterinarians are being contacted from abroad. My colleague was
offered three different jobs, for instance. He is quitting his job in
the end of May,” explains Jón Kolbeinn.
Nearly half on strike in June
There is discontent also in the general jobs market in Iceland. The
General Secretary of the Federation of General and Special Workers in
Iceland (SGS), Drífa Snædal, says that if the general strike goes ahead
in June, nearly half of Iceland’s 170,000 to 180,000 workers will go on
strike: 70,000 workers will take industrial action on 8 June if there
is no collective agreement by then.
Drífa Snædal thinks the government must help find solutions to reach
a collective agreement. She also feels everybody sees that the
government must contribute.
But the government has not been interested in presenting measures
which would help the parties reach an agreement, she says. The
government thinks the trade unions must reach an agreement before it
can contribute economically.
The Minister of Finance, Bjarni Benediktsson, recommends the trade
unions to coordinate their demands.
